A squatter with a taste for cigars and the books of fantasy writer Marion Zimmer Bradley has made a ramshackle back stoop into a temporary home, including a makeshift bed of couch cushions.
At 212 E. Geer St. on Durham's North Side, the weedy dirt yard is littered with broken glass and rusting tools. Missing bricks on the front stoop make an ideal dropoff for area drug dealers.
An activist with a paintbrush, seeking to brighten this cheerless 92-year-old home, has rendered multi-colored flowers on a wooden board in the front lawn. The painted flowers are a shock of color in an otherwise drab picture, surrounded by scrawled messages demanding something better for 212 E. Geer St.: "212 needs a family." "Rebuild me." "Creemos en la communidad"—Spanish for "We believe in community."
The story of 212 E. Geer—what real estate insiders would call a bank walkaway—is largely untold. Officials estimate less than 1 percent of the nation's vacant homes between January 2008 and March 2010 are walkaways like 212. They are primarily situated in low-income, minority neighborhoods like this one, where lending banks aren't likely to recoup cash on upkeep by selling in economically depressed zones.
"While in terms of total numbers, it's not a huge problem," says Nikki Clowers, Director for Financial Markets and Community Investment at the U.S. Government Accountability Office. The GAO issued a warning about the costs of walkaways in 2010. "It's a huge problem for those communities where it's concentrated."
The one-story rental at 212 has been vacant since late 2008. Its former owner, Arthur Barnes Jr. of Rocky Mount, filed for bankruptcy last year. Bank of America serviced the loan on the property, although Colorado-based Specialized Loan Servicing manages the loan on the bank's behalf.
Community members say neither party has wanted much to do with 212, allowing long overdue foreclosure proceedings to stall in January. If there is a real estate hell, 212 is in limbo, and its neighbors are in purgatory.
Frank Burgess can attest to that. His neighboring Geer Street home is within sniffing distance of 212. Burgess says he had to take action after a pile of soiled diapers on 212's front porch made life unbearable for him and his wife.
Burgess adds that he has called the police many times to report the drug dealers and vagrants frequenting 212, but he says he will not leave his home next door, which he has owned since 2008.
"This is our house," Burgess says. "We're not going to let somebody else run us off."
Durham-based nonprofit Reinvestment Partners is in the business of shoring up blighted communities like this one. Its executive director, Peter Skillern, calls the GAO estimate of bank walkaways overly conservative.
It's mega-banks like Bank of America, burdened by millions of loans in default in recent years, that drive the walkaway controversy, he says. "It's fundamentally rooted in the belief that it's somebody else's problem," Skillern says.
Skillern says walkaways like this East Geer Street home pose a major problem for the community, dragging down property values, attracting criminals and blighting an area where stubborn neighbors insist their economically depressed neighborhood is on the mend.
But a handful of homes, such as 212, are decaying. Since the foreclosure crisis sandbagged the American economy, eight homes have been foreclosed on in the Geer Street neighborhood.
With the poverty comes the crime, as Skillern points out. More than 100 emergency calls have been reported annually since 2007, he says.
Since 2009—when the home's last tenants left—Durham police have received reports of 37 drug violations, 16 vandalisms, 15 burglaries, three death investigations, seven robberies, three aggravated assaults, five motor vehicle thefts, three weapons violations and one rape within 500 feet of 212, according to the web crime-mapping tool RAIDS Online.
Neighbor Peter Katz, a Duke University statistician and former president of the Old North Durham Neighborhood Association, says that's likely an undercount because many crimes are not reported.
"These are real costs for our neighborhood," Katz says. "They are costs for our cities, and eventually, they're costs for the taxpayers of Durham."
Stephen Hopkins, whose home on Gurley Street is a two-minute walk from 212, says he has been beaten up five times because he phoned police when area drug dealers pushed their wares in the neighborhood.
Hopkins is a 57-year-old community activist and affordable housing advocate who ran for Durham County commissioner in 2012. He says 212 has become a sanctuary for vagabonds and criminals who lounge on the front porch for most of the day.
It's no coincidence that the home next door has barred windows. "This neighborhood made them put bars on the windows," Hopkins says.
Geer Street isn't the only Durham neighborhood plagued by abandoned homes. Divida Johnson, former homeowners' association community manager in East Durham's Ridgefield neighborhood, wrote to Durham City Council members in May that many homes in that neighborhood have been foreclosed on. Others have been abandoned.
"There are a large number of foreclosed properties that the banks are just letting sit and depreciate and this is affecting property values for the neighborhood," Johnson wrote. "I have been told by Realtors that they do not want to show houses at Ridgefield because the neighborhood looks bad."
Reached by the Indy last week, Johnson says the slow-moving banks are a "detriment" to this community.
Rick Hester, assistant director and housing code administrator at Durham Neighborhood Improvement Services (NIS), is aware of the problem. Hester, whose office enforces city housing codes, calls walkaways such as 212 E. Geer his "worst nightmare."
Hester says NIS cannot pressure a bankrupt homeowner to improve the home. Nor can NIS appeal to the bank if it doesn't assume ownership. Without a clear owner, no one is responsible for the home.
"If we don't have good information, we don't have a good case," he says. "And we have to keep on and on and on."
It's not just a Durham problem.
Nationwide, there were an estimated 14,500 to 34,600 walkaways like 212, between January 2008 and March 2010, according to a GAO report presented to the U.S. Senate Committee on Banking, Housing, and Urban Affairs.
It is expensive for local governments to tend to these homes, which need basic maintenance such as boarding of windows and trash removal. In extreme cases, cities have to pay for the demolition.
Researchers counted $13 million in total costs for code enforcement in eight Ohio cities in 2006, the GAO said. In a 2008 study, Baltimore city officials reported an annual increase in police and fire spending of $1,472 per block for each vacant or unsafe tract.
Tax revenues are hit as well, according to the GAO report, the result of declining property values and delinquent taxes owed by overstretched homeowners. In 2006, vacant or abandoned properties drained $6.5 million in revenues from hard-hit Cleveland.
In Durham, Hester says the city has spent $45,000 boarding 120 structures since June 2009.
Still, Hester says walkaways like 212 represent a modest problem in Durham, where many of the city's failing structures simply have negligent or absent owners. Since the launch last March of an NIS initiative pressuring these owners, the city's count of boarded structures has plunged from 555 to 287, Hester says.
The GAO report has prompted some action, says Clowers of the GAO. Regulators such as the Office of the Comptroller of the Currency and the Federal Reserve adopted GAO recommendations that servicers, if caught, can be forced to notify homeowners and communities if they plan to walk away from a bad property.
That's not enough, according to Victor Galloway, chairman of Reinvestment Partners' board of directors. Policies must be written that strictly forbid banks from walking away, he says.
"To walk away not only impacts the neighborhood," Galloway says. "It impacts the city at large."
Today, there's cause for hope in this Geer Street community.
Bank of America spokeswoman Jumana Bauwens confirmed last week that loan servicers plan to foreclose on 212—one year after Reinvestment Partners began pressuring the bank. Bauwens did not comment on general reasons for bank walkaways, although she blamed 212's delays on the former owner's bankruptcy proceedings.
Leaders at Reinvestment Partners hailed the news as a win. "That is a positive resolution to the problem," Skillern said. "Now we need to apply that type of solution to all of the walkaways."
Meanwhile, Reinvestment Partners continues to work in the Geer Street community. The group is renovating a two-story home at Geer and Roxboro streets with plans to turn the structure into office space. Organizers are lobbying for city neighborhood revitalization funds to transform a corner convenience store into a safer place.
"This house is going to be reborn," says Galloway of 212. "And this neighborhood is going to be reborn."
That's good news for neighbors like Hopkins and Burgess, who say they aren't going anywhere. "We won't give up," Hopkins says. "Just like a pit bull, we won't give up."
This article appeared in print with the headline "Nobody's home."