Tuesday, June 25, 2013

Racial Blockbusting in Baltimore's Edmondson Village

As reported in the Baltimore City Paper, "There Goes the Neighborhood: Edmondson Villagers Worry That Ominous Real-Estate Signs Bode Ill for the Area's Future," by Ericka Blount Danois, on 11 December 2002  --  Christmas lights twinkle along the eaves of tidy rowhouses that line the side streets of West Baltimore's Edmondson Village. Last week, the first snow brought out neighbors with shovels and children eager to enjoy the winter's first snowfall. The air is that of an old, established neighborhood, a tight-knit community of homeowners and families that used to be what Edmondson Village Community Association president Kip Hall calls "one of the premier black neighborhoods." Despite that, signs of instability and deterioration are beginning to show.

In fact, the new yellow signs tacked to trees and boarded-up buildings that have been popping up around the neighborhood are a sign that things aren't what they used to be here. Their messages (which, among other things, proclaim, we buy houses and cash for houses) are harbingers of the predatory real-estate practices that have taken hold in many of the city's poorer neighborhoods--and were blamed for devastating sections of East Baltimore around Patterson Park as recently as 1995.

Ken Strong, coordinator for the city's Flipping and Predatory Lending Task Force, says the people who post such signs--usually real-estate agents or amateur investors with some real-estate background--aren't necessarily breaking the law. However, he says, many of the practices such speculators engage in can be harmful to a neighborhood, and that many people who have been busted for "flipping"--purchasing houses at below-market rates, then selling them to unwitting buyers for inflated prices--used cash for houses signs like the ones along Edmondson Avenue to lure potential customers.

The people behind such signs often buy up homes at below-market rates in neighborhoods that show signs of deterioration; the houses are then rehabbed on the cheap and sold to either unsophisticated buyers or those who have had trouble obtaining enough credit to buy a home in another area, or to investors (often absentee landlords) who turn the homes into rental properties. Many of the houses purchased as income-generating properties are rented to tenants who qualify for the federal Section 8 housing program. Section 8 tenants are particularly desirable to many of these landlords because a portion of their rent is guaranteed by the government every month.

But these "cash for houses" practices often destabilize once-vibrant areas by chasing out homeowners and replacing them with renters and absentee landlords; such rental properties often deteriorate. T he practice contributes to rapid demographic shifts, as families are quick to leave for safer, more stable neighborhoods.

To those who live in Edmondson Village, it is particularly troublesome that these practices are popping up now, given the area's history as a place where unfair and predatory housing practices proliferated in the 1950s and '60s. Blockbusting, a practice in which real-estate agents convinced white homeowners to sell their properties at below-market value and then resold them at inflated prices to black families, swept Edmondson Village in the 1950s, changing the area from predominantly white to nearly all black in less than a decade. The practice of blockbusting was outlawed in 1968, when the Fair Housing Act made it illegal for real-estate agents to engage in unfair deals. But savvy real-estate investors manage to find ways around the law, and more subtle--but still devastating--forms of blockbusting and property flipping permeate the city.

Neighborhood residents say that Edmondson Village may have once again become a target for unhealthy real-estate practices because the neighborhood is aging.

"The reason this area is being targeted again is that the people that moved into the area in the '50s are still there and are very elderly," says W. Edward Orser, professor of American studies at the University of Maryland and author of the book Blockbusting in Baltimore: The Edmondson Village Story. "Most likely, their children are not moving into the houses, and they are on a fixed income. Also, the housing is very old now and may be in poor condition."

Hall says he is afraid that as elderly homeowners are taken in by the promise of easy cash for their houses, irresponsible tenants and absentee landlords will move in and destroy what's left of the community's foundation. "If they don't get good people to buy the property, it brings the neighborhood down," he says. The neighborhood association is trying to find a way to stem the flow of homeowners out of the area and exploring ways to keep predatory real-estate practices at bay, he says.

"We talked in a recent meeting about becoming our own realtors," Hall says. "Have the association find houses that are in trouble and have the association either help people to maintain [them], or find folks that want [them] and sell [the houses] to them." He adds that the neighborhood association is also trying to work with the city to take over and restore already-vacant properties and eventually put them up for sale too.

Strong says neighborhood residents are not the only ones who should be wary when suspicious signs offering sweet property deals show up tacked to trees and abandoned buildings. "Sellers often get a raw deal and sell their properties below their worth," he says. And "some of the properties acquired through cash-for-houses quick sales are "as is' properties--they receive cosmetic repairs before they are sold to unwary buyers."

One Edmondson Village resident, who wishes to remain anonymous, says she bought property from one of a handful of landlords who are behind the cash for houses signs now showing up in the area. After she bought her home, she says she discovered that the seller charged her three times what he had paid for it. To his credit, she says, he completely renovated the bathroom, kitchen, and basement, and added central air conditioning to the building. She was also given $2,000 cash toward settlement and $1,000 for appliances. "I gave him a check for $500, and he gave me the key," she says.

During the purchase process, she found him to be "honest and trustworthy," she says. He even promised to do further repairs if she found anything wrong once she moved in. So when water started to leak through her walls and pucker the paint when it rained, she gave him a call. No one showed up to address her complaints.

"The person he sends out to do the repairs says he is going to come at a certain time, and then he doesn't show," she says. "It is aggravating because I work, and sometimes I take off work to wait for him and he doesn't show. Some workmen came last week, but they sealed up the cracks on the wrong side of the house."

One of the real estate investors behind the signs being posted in Edmondson Village is Ronald Guy, owner of Metro Pro Homes Inc., an Ellicott City-based company that posts signs along Edmondson and Grantley avenues that read, we buy, sell, and rent, section 8 okay. Metro Pro's Web site states, "If you're a seller with plenty of equity . . . and you have plenty of time . . . you probably don't need our services."

Guy, who is also affiliated with, Sundance Properties LLC, Metro Holdings, Inc., and Renwick Properties LLC, did not return City Paper's calls for comment on this story.

"Blockbusting is bad, [and any] of the things that approach blockbusting are bad," Strong says. "If the properties are used for flipping and taking advantage of black buyers coming in, both buyers and sellers are losing out. This is destabilizing to a neighborhood."

Diane Cipollone, director of research and policy for the Baltimore-based Community Law Center, which keeps a close eye on predatory real-estate and rental practices, says community groups and organizations are trying to find ways to curb its creep into neighborhoods like Edmondson Village.

"We are concerned that those signs suggest that there is an urgency to sell in that area," she says. "Is it making other homeowners afraid and wondering if they should leave?"  (source:  Baltimore City Paper)

Racial blockbusting in Baltimore's housing, part 1


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