Under this condition, prices (values) will naturally fall. It is not the vacant houses that cause this reduction of price or value, it is natural conditions of the free market which make vacant houses the
of these conditions.
Vacant houses are not the cause of lower values and prices, they are the effect.
Anyone who falsely claims the opposite does not understand basic economic principles. In the neighborhood in which I live, there are many vacant houses. I can stand out of the street in front of my house, and see half a dozen of them. Yet in researching city tax records, in many cases the recent sale prices of houses in the neighborhood are virtually identical to those of other, more desirable neighborhoods elsewhere in the city. The only properties which suffer from reduced value are the vacant houses themselves (at least the ones which are in poor condition). The neighborhood is not considered undesirable because of the vacant houses. The neighborhood is considered undesirable because the nearest fullsize grocery store with a decent selection, laundromat, and department store is 5 miles away. The only nearby businesses are a couple of fast food restaurants, a small grocery with a poor selection, a pawnshop, and seemingly a dozen nail and hair salons. The neighborhood is not made undesirable because of the vacant houses, it is undesirable because the lack of essential businesses make it extremely inconvenient to live here. Along with the false perception of higher crime in the neighborhood, this is the true cause of lack of demand for the housing that is available. The proponents of urban renewal schemes will argue that low property values are a bad thing. Again, the opposite is actually true. Areas where property values are low represent the bottom rung on the economic ladder. They are the areas where lower income people live. If areas of low property values did not exist, where would lower income people be able to afford to live? If the bottom rung of the economic ladder was somehow eliminated, lower income people would never be able to afford to buy a house. The standard of living would fall as lower income people are forced to spend a greater percentage of their income on housing. Renters would be forced to share with others with low incomes, packing additional residents into ever more crowded dwellings. Proponents of urban renewal schemes will claim that their efforts will help the poor, when in fact they are doing the opposite.
OKC is one of the few major cities in America that still has neighborhoods with low property values, and this is one of the specific reasons why I moved here.
At my income level, I can maintain a much higher standard of living than I would be able to elsewhere, precisely because of those low property values. Because it was stolen from me by a city government in a similar urban renewal effort, I was forced to go from living in a 2600 square foot house that I owned outright with no mortgage, to renting a single room and sharing a kitchen and bathroom with complete strangers. For what I paid to rent a single room in another part of the country, I can now rent a two bedroom house with a garage here in OKC. I defy the proponents of urban renewal to explain how lower property values have hurt rather than been beneficial to me! Those lower property values have given me at least a shred of my former standard of living back. Over the last 15 years, I have seen many of my friends go from being able to rent their own apartment, to being forced to rent houses together with each other as the lowest rungs on the economic ladder have been eliminated in other parts of the country. If property values rise, and incomes do not, this does not help the poor. If property values