NYC’s Abandoned Homes Are Going for Shockingly Low Prices — Here’s Why

Summary

Abandoned homes in New York City, often called “zombie properties,” are residential buildings left vacant and neglected, typically during foreclosure proceedings. These properties frequently fall into severe disrepair, creating health and safety hazards, attracting criminal activity, and depressing surrounding property values, which negatively impact neighborhood stability and local economies. The persistent presence of such abandoned homes presents significant challenges to communities and municipal resources, prompting ongoing legal, policy, and grassroots efforts to mitigate their effects.
The phenomenon of abandoned properties in New York City is intertwined with broader housing market dynamics, including a chronic shortage of available homes, rising mortgage interest rates, and “housing lock,” whereby homeowners hesitate to sell due to unfavorable market conditions. While the city’s housing inventory remains near historic lows, abandoned homes often sell at shockingly low prices because of their dilapidated conditions and neighborhood stigmas, further complicated by speculative investment practices that limit access for typical homebuyers. These factors contribute to a complex and often contentious real estate environment marked by disparities between thriving luxury developments and struggling, blighted neighborhoods.
Historically, urban renewal policies and federal programs aimed at combating urban blight have had mixed outcomes, frequently resulting in displacement of low-income and marginalized communities while attempting to stimulate redevelopment. Modern legislative initiatives, such as the New York State Zombie Property and Foreclosure Prevention Act of 2016, alongside city programs and community-driven revitalization efforts, seek to address the ongoing challenges posed by abandoned properties. However, tensions remain between economic revitalization goals, housing affordability, and the preservation of community integrity.
The role of external investors and speculators has sparked significant controversy, as institutional buyers often outbid local residents, driving up prices and contributing to housing insecurity. Policymakers continue to explore measures to curb speculative practices and promote equitable access to housing. Meanwhile, grassroots organizations play a vital role in neighborhood revitalization, emphasizing resident-led solutions that foster sustainable, inclusive urban development. Together, these intersecting issues highlight the multifaceted nature of New York City’s abandoned homes crisis and its broader implications for urban policy and social equity.

Definition and Legal Framework

Abandoned homes in New York City, often referred to as “zombie properties,” are residential buildings that homeowners have forsaken, typically during foreclosure proceedings. These properties remain unoccupied, resulting in a lack of basic maintenance and leading to significant deterioration and disrepair. The neglect of such homes poses considerable challenges to communities, including lowered property values, increased criminal activity, health and safety hazards, and elevated public costs for police, fire, and building safety services.
Legally, abandoned and escheated properties in New York are governed by the Abandoned Property Law, codified as Chapter 697 of the Consolidated Laws, enacted on April 23, 1943. This legislation establishes a comprehensive framework addressing unclaimed and abandoned properties, outlining definitions, policies, and procedures for escheat and management. The law encompasses various types of unclaimed property, including real estate, deposits, security holdings, and more.
Recent legislative efforts have sought to modernize and expand the scope of the Abandoned Property Law. For example, during the 2019-2020 legislative session, a bill was introduced to include unclaimed virtual currency within the law’s purview, shorten dormancy periods for unpaid wages, and recognize electronic communications as valid written consent in regulatory processes. These updates reflect ongoing attempts to address evolving forms of property and enhance protections for owners and communities alike.

Historical Context

Urban renewal programs in New York City have a long and complex history, often intertwined with the displacement of low-income and marginalized communities. Between 1949 and 1974, federal urban renewal initiatives aimed to combat urban “blight” through large-scale slum clearance, funded primarily by federal grants that supported urban planning, property acquisition, relocation of residents and businesses, and demolition of substandard structures. While the stated goal was revitalization, these efforts frequently resulted in direct displacement of residents forced to leave their homes, as well as indirect displacement through gentrification and rising housing costs that priced out low-income populations.
The urban renewal process often prioritized economic revitalization, social or cultural regeneration, and environmental sustainability, seeking to transform underutilized urban areas into vibrant hubs of activity. However, ethnographic studies have documented the significant social costs of these programs. For example, the destruction of neighborhoods like Syrian Town in Easton, Pennsylvania, revealed how displaced communities strive to maintain cohesion through collective memory despite physical displacement.
Locally, New York City’s approach included policies such as selling unused properties for nominal prices to encourage redevelopment, often requiring developers to submit specific housing plans and demonstrate funding. These initiatives aimed to reduce city maintenance costs and stimulate development but also sparked criticism. Legal advocates expressed concerns that such policies were not resident-led and risked uprooting vulnerable populations. At the same time, city officials pointed to the deteriorated conditions of much of the public housing stock—characterized by mold, asbestos, and lead paint—as justification for seeking innovative redevelopment solutions.
The legacy of abandonment and vacancy remains a significant challenge. Programs like the Vacant and Abandoned Property Program in Western New York were created in response to the negative impacts of abandoned homes on families and neighborhood stability. Research indicates that housing abandonment contributes to neighborhood decline by depressing nearby property values, exacerbating housing insecurity and economic distress. Today, New York City continues to grapple with a severe housing shortage, complicated by a historic low inventory of homes for sale and economic factors such as rising mortgage rates that discourage homeowners from selling, further constraining supply.

Current Market Conditions

The current housing market in New York City is characterized by a limited inventory of homes, particularly in desirable locations, which continues to support property prices despite broader economic challenges. Over the past three years, the supply of available homes has steadily declined and is now near a seven-year low, intensifying competition among buyers and contributing to price resilience.
Economic factors also play a crucial role in shaping market dynamics. New York’s diverse economy provides a foundation of stability; however, rising mortgage interest rates, which hovered around 7% as of early 2025, have begun to affect buyer affordability and influence purchasing behavior. Despite these higher rates, the volume of homes entering contracts in the city has continued to increase, signaling ongoing demand in the housing sector.
Meanwhile, the presence of abandoned and dilapidated homes exacerbates neighborhood challenges and impacts local real estate values. Properties left vacant and unmaintained tend to fall into severe disrepair, which not only depresses surrounding property values but also attracts crime, poses health and safety risks, and burdens municipal resources. The negative effects of these abandoned properties can persist for years while communities await foreclosure and subsequent redevelopment or sale.
In addition to inventory shortages and property conditions, rental market stress remains high. A majority of renters in the city face rent burdens, with many paying over 30% of their pre-tax income on housing, and a significant portion enduring severe rent burdens exceeding 50% of income. Eviction rates have returned to pre-pandemic levels, disproportionately affecting neighborhoods with predominantly Black and Latinx populations, contributing further to housing insecurity and homelessness, which has reached record highs following pandemic-era improvements.
Crowding in housing units has worsened moderately city-wide, particularly in Brooklyn and Queens, although Manhattan has seen slight relief possibly due to post-pandemic demographic shifts and changes in household income distribution. Public housing areas continue to face issues of isolation and crime, with initiatives underway to integrate these spaces more fully into their surrounding communities to reduce crime and improve quality of life.
Price trends illustrate the stark contrasts within the city’s real estate landscape. For example, Manhattan’s Two Bridges neighborhood saw median sale prices rise by 288% between 2014 and 2024, driven largely by new luxury developments. However, proximity to homeless shelters and other neighborhood characteristics continue to influence property values, as shown by detailed econometric analyses controlling for multiple factors.

Factors Contributing to Low Prices

One of the primary factors contributing to the low prices of abandoned homes in New York City is the presence of “zombie properties,” which are homes abandoned by their owners, typically during foreclosure proceedings. These properties often fall into serious disrepair due to lack of maintenance, creating health and safety hazards, attracting criminal activity, and imposing additional costs on local governments for police, fire, and building safety services. The deteriorated condition of these homes negatively impacts surrounding property values and the broader community, further depressing their market prices.
Another significant factor is the chronic shortage of housing supply relative to demand. While the overall inventory of homes available for purchase has declined steadily over the past several years, reaching near seven-year lows, the scarcity is compounded by what is known as “housing lock.” This phenomenon occurs because many homeowners are reluctant to sell their properties, as they hold low mortgage rates secured in previous years and fear selling at prices lowered by higher current mortgage rates. The limited turnover of homes for sale further restricts supply and affects market dynamics.
Economic conditions also influence property prices. Although New York’s diverse economy generally provides some market stability, fluctuations such as rising interest rates or economic downturns can reduce buyer demand and exacerbate price declines for certain properties, especially those in poor condition or less desirable locations.
Additionally, community opposition to new developments, including shelters or rehabilitations near abandoned homes, can influence property values. Concerns about safety, loitering, and perceived negative behavior by shelter residents often create stigma that deters buyers and investors, thereby maintaining low prices in affected neighborhoods.
Finally, displacement and gentrification pressures in urban renewal areas indirectly affect abandoned homes’ pricing. When renewal projects prioritize development over resident retention, low-income residents may be displaced, but surrounding housing prices can become volatile. The uncertainty and social challenges tied to these dynamics can contribute to the depressed values of certain abandoned properties.

Impact on Local Communities

Abandoned and dilapidated properties have profound negative effects on local communities. These properties often lead to lower property values and can attract criminal activity, creating both health and safety hazards for residents. Additionally, they impose extra costs on local governments due to the increased need for police, fire, and building safety resources. While maintenance actions such as boarding up windows may help secure these properties against vandalism or crime, they can also contribute to the perception of neglect and become eyesores within the community.
Urban renewal efforts aimed at addressing such blight have had mixed consequences, particularly for marginalized communities. Studies reveal that urban renewal disproportionately displaced Black households and neighborhoods, with local political strategies often targeting entire communities for removal. This displacement was exacerbated by limited enforcement of fair housing laws, which allowed systemic barriers to prevent displaced Black residents from moving into predominantly white neighborhoods. Ethnographic research has further documented how displaced communities, such as those from Syrian Town in Easton, Pennsylvania, maintain their social ties through collective memory despite physical displacement caused by redevelopment projects.
Community-driven and grassroots initiatives play a critical role in revitalizing neighborhoods and mitigating these adverse impacts. Programs like Refuse Refuse demonstrate the power of sustained local engagement in city clean-up and urban redevelopment campaigns, highlighting the importance of resident involvement in restoring community cohesion and safety. Furthermore, visionary approaches within public housing aim to reduce isolation and crime by integrating these developments into the broader community fabric, as seen in efforts to transform sites like Fulton & Elliott–Chelsea in New York City. Increasing pedestrian and commercial activity in such areas is intended to deter criminal behavior by reducing the opportunities that isolation provides.
Together, these factors illustrate the complex interplay between abandoned housing, urban renewal, and community wellbeing, underscoring the need for inclusive policies and local participation to foster safe, healthy, and equitable neighborhoods.

Government Policies and Programs

New York State and City have implemented various policies and programs aimed at addressing the challenges posed by abandoned, vacant, and blighted properties. These initiatives seek to revitalize communities, increase affordable housing availability, and mitigate the negative impacts such properties have on neighborhoods.
One prominent program is Restore New York, administered by Empire State Development. It focuses on encouraging new commercial investments through community revitalization, promoting housing growth, and returning properties to the tax rolls to expand the local tax base. The program emphasizes rehabilitating vacant and blighted areas to make downtowns thrive by catalyzing economic growth and supporting housing, businesses, and cultural spaces.
Historically, urban renewal programs stemming from the Housing Act of 1949 aimed to address post-World War II housing shortages by clearing slums and facilitating large-scale redevelopment. These federal grants funded urban planning, property acquisition, relocation, and demolition of substandard structures. However, the program often failed to keep pace with displacement or adequately address local housing needs, particularly affordable and unsegregated housing. This legacy has informed modern policies that seek to remedy past harms and promote equitable redevelopment.
At the city level, the Department of Housing Preservation and Development (HPD) has played a significant role since the 1970s in financing the development and preservation of affordable housing to combat issues ranging from abandonment to gentrification. HPD offers various opportunities and support for housing inspectors, planners, and developers to maintain safe, quality, and affordable homes. These efforts include city-sponsored rental and homeownership programs, home repair loans, and preservation financing.
Financial mechanisms have been established to aid rehabilitation and development. The city has provided low-interest loans covering up to two-thirds of rehabilitation costs, becoming second mortgages to maintain affordable rents for low- and moderate-income households. HPD collaborates with organizations such as the Local Initiative Support Corporation (LISC) and Enterprise Community Partners to combine Low Income Housing Tax Credit financing with city loans and grants. Additionally, the Vacant Building Program facilitates the transfer of clusters of city-owned vacant buildings to private developers through competitive processes, supported by construction financing from entities like the New York City Community Preservation Corporation.
Specific legislation addresses the problem of “zombie properties,” homes abandoned by owners often facing foreclosure. Such properties pose risks including disrepair, decreased property values, increased crime, and added burdens on municipal resources. The Vacant and Abandoned Property Law, signed in 2016, establishes a statewide electronic registry to track these properties and guides enforcement to mitigate their impacts. Local governments, including New York City, provide reporting mechanisms for vacant buildings. Programs like the Western New York Law Center’s Vacant and Abandoned Property Program work in partnership with municipalities to preserve homeownership and maintain neighborhood integrity despite the legal complexities involved in addressing foreclosed properties.
Beyond government action, grassroots and community-driven initiatives have proven essential in urban revitalization. Efforts like Refuse Refuse leverage social influence within neighborhoods to encourage proper disposal and cleanup, helping to drive sustained city redevelopment campaigns from the ground up.
Together, these policies and programs represent a multifaceted approach to tackling the complex challenges of abandoned and blighted properties in New York City and State, aiming to restore vibrant, safe, and affordable communities.

Role of External Investors and Speculators

External investors and speculators have increasingly played a significant role in the dynamics of the New York City housing market, particularly in the context of abandoned and undervalued homes. Institutional investors, often backed by substantial financial resources, have been able to purchase single- and two-family homes rapidly, frequently outbidding individual homebuyers and removing properties from the market before typical residents have a chance to engage with them. This trend has contributed to first-time homebuyers being shut out of the market, with an estimated 2.5 million households nationwide facing such obstacles in 2023, partly due to the growing influence of investors.
The impact of these investors extends beyond pricing pressures. Some research indicates that housing abandonment, often linked to speculative investment practices, contributes to neighborhood decline by depressing nearby property values and exacerbating urban blight. Speculative behaviors include actions such as rapidly flipping properties at inflated prices, borrowing heavily against buildings, and “warehousing” vacant apartments during housing shortages to wait for market conditions to improve. These tactics can lead to deteriorating housing conditions for tenants and increased displacement risk, particularly in lower-income communities where anonymous LLCs and other opaque ownership structures predominate.
In response to these challenges, policymakers have sought to curb the influence of deep-pocketed investors. New York State officials have proposed measures to reduce tax advantages for institutional investors purchasing small residential properties, aiming to level the playing field

Community and Grassroots Revitalization Efforts

Grassroots initiatives have played a crucial role in the revitalization of urban areas, particularly in addressing the challenges posed by abandoned and blighted properties. Programs such as Refuse Refuse exemplify how community-driven efforts contribute significantly to city clean-up events and urban redevelopment campaigns, serving as consistent and sustained drivers for revitalizing neighborhoods. These local movements often work in tandem with government programs, helping to catalyze broader economic and social improvements.
One key example is the Restore New York program, administered by Empire State Development, which encourages local governments to attract new commercial investments, expand housing options, and return vacant properties to productive use, thereby increasing the local tax base. This initiative supports municipalities in planning for future growth by fostering economic vitality, housing development, business opportunities, and cultural spaces within downtown areas. Such programs are designed to complement community efforts by providing technical assistance and financial incentives, making urban renewal a collaborative process between grassroots organizations and government agencies.
In addition to these top-down initiatives, tenant-led efforts have also contributed to community revitalization. Programs like the Tenant Interim Lease (TIL) enabled tenants to rehabilitate and eventually gain legal ownership of their homes or abandoned buildings, fostering cooperative affordable housing models throughout the city. Since the 1970s, nearly 30,000 affordable cooperative units have been created, many supported by federal housing loans and local nonprofit organizations. These models empower residents to take control of their neighborhoods, preserving affordability and promoting long-term stability.
Beyond economic and housing improvements, community revitalization efforts often aim to restore social and cultural connections within neighborhoods. Ethnographic studies highlight how displaced communities maintain their collective memory and identity despite urban renewal processes that have historically disrupted marginalized populations. This aspect underscores the importance of inclusive and equitable development practices that recognize the social fabric of affected communities.

Case Studies

One notable case involved a homeowner whose property was acquired and subsequently demolished by a private company following a legal verdict. The company failed to complete the contracted construction on the site, leaving the plot vacant and undeveloped. This scenario is reflective of a broader pattern seen in other regions, particularly in the Rust Belt, where extensive demolitions under urban renewal programs cleared entire neighborhoods in cities such as Syracuse, Cincinnati, and Niagara Falls. These cleared areas often became surface parking lots, sparse industrial zones, or remained as vacant land due to speculative development plans that never materialized.
In New York City, neighborhoods in Central Brooklyn, Southeast Queens, northern Staten Island, and parts of the Bronx have experienced significant numbers of abandoned and deteriorated homes, many of which are currently in foreclosure. According to the city’s Department of Housing Preservation & Development (HPD), there are at least 2,000 such properties, illustrating the widespread nature of the problem across multiple boroughs. These abandoned properties contribute to neighborhood decline, often depressing nearby property values and impacting community stability.
Additionally, the phenomenon of “zombie homes” has become a critical issue in the city’s housing landscape. These are homes that remain vacant and deteriorating, sometimes abandoned by owners delinquent on mortgage payments or seized by lenders, but left unoccupied and neglected for extended periods. The New York State Zombie Property and Foreclosure Prevention Act of 2016 was enacted in response to this crisis, and the city has taken further measures to directly address these problematic properties.
Efforts to revitalize and repurpose these vacant and abandoned properties are underway through various community and governmental programs. For example, Neighborhood Restore, a nonprofit organization, works to transition properties from abandonment to third-party ownership, focusing on affordable housing development and neighborhood stabilization. Similarly, the Western New York Law Center’s Vacant and Abandoned Property Program targets the preservation of homeownership and neighborhood integrity in areas affected by foreclosure and abandonment.
These case studies demonstrate the complexities and challenges faced in managing abandoned properties in New York City and beyond, highlighting the interplay between legal, economic, and social factors in urban housing crises.

Challenges and Limitations

Dilapidated vacant and abandoned properties pose significant challenges to New York City communities, as they can depress local property values, attract criminal activity, and create health and safety hazards. These negative impacts often persist for years while properties remain in foreclosure or await new ownership, imposing additional costs on local governments through increased demands on police, fire, and building safety resources. Although measures such as boarding up windows can secure these properties against vandalism or crime, such actions may also contribute to neighborhood blight and community dissatisfaction.
Efforts to promote homeownership and address abandoned properties face limitations due to the small scale of relevant programs. Initiatives like HomeFix and the Senior Citizen Assistance Program primarily focus on small owner-occupied buildings (1-4 units), making it difficult to substantially increase homeownership rates or rapidly reduce the stock of abandoned homes. Moreover, the overall decline in homeownership starting in fiscal years 2020 and 2022 complicates assessments of program effectiveness over time.
Another critical challenge arises from the role of institutional investors in the housing market. These “deep-pocketed” investors often make quick cash offers on single- and two-family homes, removing opportunities for average New Yorkers to purchase properties. To counteract this, state proposals aim to restrict investors’ ability to benefit from certain tax deductions—such as depreciation and interest deductions—unless the properties are sold to affordable housing nonprofits or individual homebuyers. This policy is intended to discourage speculative purchases that reduce housing availability and affordability for residents.
The broader context of high housing costs and increasing homelessness further exacerbates the situation. Rising prices force working-class families out of the city, while an influx of migrants and rising homelessness among non-migrants place additional strain on the city’s shelter system. This environment heightens the urgency for effective strategies to rehabilitate abandoned properties and expand affordable housing options.
Despite legislative efforts addressing related issues, such as expanding the scope of abandoned property laws to include unclaimed virtual currency or updating consent regulations, there remain gaps in comprehensive approaches specifically targeting the rehabilitation and productive reuse of abandoned homes. While technical assistance and strategic investment planning support community revitalization projects, these initiatives require sustained resources and coordination to address the multifaceted challenges of property abandonment, economic pressures, and equitable urban development.

Future Outlook

Experts predict a modest but steady rise in home values in the New York metropolitan area over the coming year, suggesting that while a housing market crash is unlikely, understanding market nuances remains essential for potential buyers and investors. One of the primary factors influencing this outlook is the fluctuation of interest rates, which directly affect mortgage affordability and thus buyer demand.
Looking ahead, initiatives aimed at improving housing conditions and energy efficiency are expected to play an increasingly important role in the housing landscape. Partnerships between developers and public/private agencies focus on implementing portfolio-wide solar and energy upgrades, ensuring compliance with sustainability laws, and advocating for affordable housing energy improvements. These efforts aim to make homes more comfortable, healthy, and energy efficient for all income levels.
Furthermore, there are ongoing discussions about reforming property tax policies to better align the tax burdens of coop and condo owners with those of conventional homeowners. Proposals include both short- and long-term reforms that may prove more effective than current abatements in creating a fairer tax system for residential property owners.
The future of urban renewal and housing policy also reflects broader goals beyond simple economic revitalization. Modern urban renewal initiatives frequently target social and cultural regeneration as well as environmental sustainability, striving to transform underutilized urban areas into vibrant economic and cultural hubs while promoting equitable development. However, historical lessons emphasize the need to carefully consider the impacts of such initiatives on marginalized communities, as displacement and neglect have been persistent challenges.
Nonprofit organizations like Neighborhood Restore continue to address issues related to abandoned properties by facilitating the transition of such homes from financial and physical abandonment to productive third-party ownership, which may contribute positively to neighborhood stabilization and affordability.

The content is provided by Jordan Fields, Scopewires