Abandoned, vacant, and neglected properties are common around Pittsburgh. All too often, we connect with property owners who haven’t seen or done anything with their properties in several years.
Let’s discuss why you should never do this, and if you have done it, why you should take action immediately.
The reason why people do this is because the property may need costly repairs and have issues, there may be mortgage or tax default, or the property was taken over by squatters and non-paying tenants.
You can’t just abandon a property without risking or facing ugly consequences. Perhaps the biggest consequence is legal liability.
As long as a property is in your name, you are held legally liable for it. Imagine if someone were to enter the property, and claim that they became severely injured when meandering on your property, and you find out by receiving a startling piece of mail regarding a lawsuit from a personal injury attorney. There are unfortunately predatory people out there who look for opportunities like this to take advantage of.
Other important reasons why you should never abandon a property you no longer want:
- risk of vandalism
- animal/pest damage
- water and moisture/mold damage from neglected roof/gutters
- frozen and busted pipes from not controlling the temperature of the home or a brutal winter
- Abandoned and vacant properties deteriorate faster
- Easy target for a “midnight plumber” (someone who breaks in, breaks open your drywall, and steals your pipes to scrap for quick cash)
- risk of code violations, fees, fines, and legal threats from your local code enforcement and municipality
- angry and frustrated neighbors whose properties and well being are impacted by the issues of the vacant and abandoned properties next to theirs
The City of Pittsburgh recently went on a taxation and fee binge on anything and everything.
Beginning on May 1, 2019 a building permit fee for a total gut rehab ($150,000 rehab estimate) on a single family home will go from $150 to $850: that’s an 83% hike! Yikes!
What is the impact?
PGH Property Buyer believes that this will inhibit numerous homeowners and property owners from being able to make basic necessity repairs and enhancements to their properties.
In addition, it could absolutely hold back hard working carpenters, construction workers, and local small business companies from doing more business.
When it comes to rental property owners who invest their life savings into rental properties to supplement retirement, we could likely see them pass on this expense indirectly by raising rental rates.
One thing we can learn from this is that for every action comes a reaction!
Did you know that Pennsylvania is among the top states plagued with staggering and economically crippling taxation?
Did you also know that beginning on January 1, 2020, the City of Pittsburgh will have the highest total combined real estate transfer tax rate in the US!?
This ordinance negatively impacts people in the City of Pittsburgh of all walks of life except the governing entities. However, the direct impact that this ordinance has falls on real estate buyers and sellers.
What should we expect to see?
We at PGH Property Buyer believe that it has the potential to slow economic movement and growth because it makes it more difficult and expensive for a seller to sell and a buyer to buy. This will likely trickle into rentals and leasing and upset the current balance of tenants, rental rates, and vacancies.
Our forecast expects to see an economic gridlock effect take place. We personally believe that these astronomical tax hikes incentivize families, developers, landlords, tenants, new and local small businesses, and investors to engage less in the City of Pittsburgh and engage more in the suburbs and boroughs surrounding the City of Pittsburgh.
Owning a vacant property comes with risks. Today we will discuss the challenges and offer solutions for owning vacant property.
We at PGH Property Buyer aren’t the only people who perceive a property that sits vacant as a negative. Did you know that homeowner insurance for property is automatically quoted higher if it is not occupied?
Vacant properties around Pittsburgh are easy targets for squatters and vandalism because many homes are very old and contain valuable copper pipes. Copper pipes are at the top of the list for what intruders desire to take.
-higher probability of break ins, vandalism, squatters, stolen pipes
-no cash flow
-harder to maintain landscaping
-higher probability of wildlife pests accessing and destroying the interior
-greater likelihood of mold accumulation and pipes freezing and breaking
-greater likelihood of trespassers and accidents happening on the premises
-Make friends with the neighbors, and ask them to watch over your home. Exchange contact info and be supportive with each other.
-Hire a property management company.
-Install a camera and security system.
-Hire a landscaping company to maintain the grounds regularly.
-Rent, move in, or sell the property.
-Arrange a seller finance or rent-to-own scenario in which the occupant is responsible for the entire property upon executing the agreement.