Banks Urged to Pay for Foreclosed Home Maintenance

Rule would fine banks that don’t take care of foreclosed homes

Support is building around San Diego for an ordinance that would require banks to take better care of foreclosed homes.

Seventy percent of participants surveyed in a Center on Policy Initiatives poll said they support the proposed Property Value Protection Ordinance, the center announced Wednesday.

The ordinance has been floating through City Hall for several months now and would fine banks $1,000 per day if they fail to follow city property codes.

“This is a way we can hold banks responsible to their obligations just like we would any other homeowner when there is a violation of code,” said Councilman David Alvarez at a press conference Wednesday announcing poll results. “We ask them to maintain their property for the good of our community.”

San Diego State Real Estate Professor Mark Goldman said the ordinance would keep the property value of foreclosed homes stable. He said these foreclosed homes are typically worth about half as much when the bank takes over.

Chipping in for yard and pool maintenance would benefit banks too, he added. Often foreclosed homes attract graffiti and vandalism, let alone the effects of neglect.

“Not paying for upkeep is bad for the banks too,” Goldman said. “The value of their property is declining as well.”

Requests for comment from a Bank of America spoksperson on their response to the proposed ordinance were not returned.

Goldman said although such an ordinance would help keep property values up, it may be difficult to enforce, and would require some defining of standards for homes.

The city’s Independent Budget Analyst and Neighborhood Code Compliance Department have both reviewed and provided reports on the ordinance.

The ordinance’s supporters urged City Council approval on Wednesday.

The Land Use and Housing Committee will vote on the ordinance in July. If it is approved, it will go to the San Diego City Council for another vote. 

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