Evelyn Fields Day remembers childhood home before foreclosure
It’s hard enough tracking down the backstories of some of Kansas City’s hard-bitten, tax-delinquent houses.
The man in black and red out front of this one near 22nd Street and Elmwood Avenue wants a payoff to tell what he knows.
“Hurry up,” he says, beckoning with an agitated hand. “I’m looking like a snitch out here.”
Forget it, he says, when he sees no cash is coming. And when his questioner offers a parting wave, the man matches his gaze with his hands extended together, tracing the visitor’s path, braced as if triggering a gun.
“Boom! Boom! Boom!”
So goes a journey to discover the stories behind some of the 826 properties that were put up for auction on the Jackson County Courthouse steps in the latest annual tax-delinquent sale.
Along the way there are neighbors protesting dangerous buildings. Tenants decrying negligent owners and rising rents. Owners falling victim to destructive tenants and pleading for financing help. And city and community planners working to turn the corner on distressed properties that blight so many low-income neighborhoods in Kansas City.
Some houses are less inviting than others. A dead raccoon, half-rotted, lay on the porch between the top step and the front door at 30th Street and Park Avenue.
And it only seems that no one lives in the tree-swarmed house near 26th Street and Quincy Avenue, with the abandoned couch outside, the broken concrete steps, and no answer to a knock on the door.
“Bunny” lives there, a neighbor says from the porch next door. She’s somewhere behind the half-boarded windows. She’s just not taking visitors.
Check out the five completely overgrown Kansas City properties owned, somewhat mysteriously, by a synagogue in suburban Los Angeles. And the two abandoned properties controlled by a Las Vegas investor, leftovers from the liquidation of hundreds of properties in an investment scam on Detroit’s police and fire pension fund.
Most of the investors, however, are well-intentioned but often in over their heads trying to help revive the hardest parts of the community.
“You see the guys on TV who say you can get property with nothing down,” said Ken Mabrie, a Raytown investor who has lost Kansas City houses to the auction. “And you go to these real estate courses and they tell you how to increase the limits on your credit cards. They tell you how to negotiate higher limits.”
It’s too easy to take a dive in a market still scarred by the subprime lending crash, he said.
There’s not enough lending help, and the next thing you know — as with Mabrie — a neighbor is sitting on a porch across from a house you used to own at Scarritt and Elmwood avenues, testifying to its tale of woe.
“Someone bit off more than they could chew,” Richard Bartlett said. He’s seen a lot of people come and go as the house went under, the last tenant carelessly barbecuing on the front porch, sending it all up in flames. Black scars streak the walls where the porch used to be.
No takers for that house at the auction.
Jerry Jones, 53, steps out of a house in the twilight of a workday near 24th Street and Lister Avenue. He has a paintbrush in his hand. Ready to call it a day for his handyman work.
“Let me show you something,” he says.
He’s not talking about the pile of furniture and trash that the last tenants left on the curb, or the 20 bags of garbage strewn out the back door.
This is about another house he had to clean. He has pictures on his phone.
“See that?” he says, scrolling. A broken closet. A junked kitchen, its sink buried in trash…
In one house like that, the renters paid just twice but stayed a year. Couldn’t get them to leave, he said.
“It costs to get them evicted, getting an attorney. Then fines come. And you go down in front of the judge.”
It’s a mess out there, with the 826 properties in the tax-sale auction representing just a slice of the distressed properties scattered across Kansas City’s central core.
It’s a heavy wave, even as it ebbs from the overwhelming flood of the post-real-estate-crash years, when 862 of 1,256 auctioned properties went unsold in 2012.
There are far more vacant houses now than the city could ever hope to have rescued by owner-occupants, said Michael Duffy, the managing attorney at Legal Aid of Western Missouri.
So city programmers and activist groups are stumbling after complicated relationships with investors.
“We need more folks salvaging property that they operate as rentals…as a transition strategy,” Duffy said. “There is money to be made. If we support investors, eventually we can reach the point where the market can sustain owners.”
But the city and partners working on this puzzle don’t yet have a good mechanism to separate the negligent speculator from the investor who is making a good-faith effort to rehab properties, Duffy said.
Homeowners who let properties rot need to be fined and prosecuted, but good investors need a safe harbor. They need access to loans to get derelict houses turned around and occupied, Duffy said.
The trick the city and public and private partners are exploring is how to share the lending risks in such a volatile arena.
Jones knows the sudden ups and downs real close. He lives in a house whose owner lost it to the tax sale.
“I’ll have to see if I can work it out with the new owner,” he said. “God will figure it out.”
The foreign investor
Craig Walton couldn’t believe it.
He’d been an investor and developer in England for many years before his company opened a branch office in the Kansas City area, tapping into the American Midwest.
He was curious about the strategies Americans employ, so he tried one of the many real estate seminars and was disturbed by the speakers’ insistence that bending your credit limits was the first step.
“People are getting in and getting in trouble,” Walton said. Many are in California or other Western states where management companies entice them to buy property in the heartland that looks tantalizingly cheap compared with offerings on the Coast. The tax-delinquent rolls are filled with out-of-state, even out-of-the-country investors as far as Australia and New Zealand.
Walton was sitting at a coffee shop table with Tom Ribera, a developer in Kansas City’s Northeast neighborhood and teammate in several projects.
“The repairs get way out of hand,” Ribera said, laying out the recurring scenario. “You’re deeper in the hole. And the person in California is saying, ‘Where’s the money?’ ”
You don’t really know what’s in store in a rehab, said Robert Schock, director of property management for the Yarco Cos., “until you get to the meat of the coconut…and open the wall.”
Plumbing. Water leaks. Wiring. This is where promising investments turn toward boondoggles.
“Property almost never generates the amount of money they (novice investors) think it will,” Schock said.
The woman who pokes her head out of the door in the 300 block of Chelsea Avenue doesn’t want to be named. She hasn’t figured her way out of her dependence on this house yet, and she still has to deal with her landlord.
But she’s scared. When properties are threatened with a tax sale, the notices go in multiple directions in a thorough search for the property owner, including the “dear resident” letters that hit the tenant’s mailbox.
“Problems are never fixed here,” she says. “I got a letter from the government about this being foreclosed on.”
It’s not just her welfare she has to worry about.
“This is a family with children,” she says. “They can’t go on the streets. I think they’re scamming all the renters who don’t have a place to go. This is not right at all.”
Titania Sutherland, however, has a plan to get out of her rented house near 37th Street and Bellefontaine Avenue, and it can’t be soon enough, she says. A new landlord waits.
“We’ve been sick in this house,” she said. “My little girl got lead poisoning. We’ve had electrical issues. There are spiders in there.”
And there’s more, she goes on. Her son hurt his arm on a fence that has since been taken down. The basement flooded, hitting her with a water bill “like I had a swimming pool.”
Renters in neighborhoods with concentrations of distressed properties are the most vulnerable, says Tara Raghuveer, who studied Kansas City housing while at Harvard University.
Rising rents throughout Kansas City have further pressured low-income families with fewer low-rent options, she said.
“Landlords know they can kick them out and that it is easy to fill the vacancy,” she said. And if a dispute were to get to housing court, landlords “know they can win.”
The property owner
Fedrick Marshall knows what people think.
He’s 35 and has been slowly building up housing investments in neighborhoods around his own house since he was 23.
The tenants who try to talk him into giving them a break from a month’s rent here or there “think I’m rich,” he said.
And there are plenty of people, he said, who look at any investor and think: “Scumbag.”
The woman complaining on Bellefontaine was his tenant, and, yes, that house was a problem.
But as the first tenant in a house he completely renovated, she was supposed to help alert him of the kinds of issues that can come in that first opening.
He could have taken care of that water backup long before it became a basement flood. “But now it’s a big loss.”
Many have gone much better. Look, he said, at this house he’s just finishing in the 6000 block of Agnes Avenue.
Roof patched. Floors sanded and varnished. Freshly painted. New kitchen appliances. The outside of the house cleared of all the brush. Beautiful. Adored now by neighbors who are relieved that the longtime eyesore is suddenly charming.
Do they know how hard this is, trying to take on one or two new properties every year?
He’s learned so much the hard way — starting with one of his first houses when he had brought his mother over to see the beautiful work he’d done.
Instead, he gaped at a burglarized house stripped of wiring and appliances, shuddering while his mother rubbed his shoulders and whispered, “You can do it again.”
He knows now to conceal a house’s vacant status, and to put in the expensive amenities at the last moment, only when that first tenant is assured and ready.
It’s a race to turn a house around as quickly as possible. Get it under control, save it from weather and prime it for a tenant. He pours in money he saves from his construction worker income.
He’s put off buying clothes and shoes for his kids. It has strained relationships.
With a few more steps forward against so many steps back, he has built a portfolio of 13 rented houses and six vacant, he said, though the difficulty still shows in that he lost one back into the tax sale.
“I’m gambling here right now,” he says. “I fix these houses up with the only money we have, taking money away from my family, and then you won’t pay your rent? You’re thinking I won’t miss $400?”
The city official
Given a choice, the city and some of its urban renewal partners would rather help those home buyers who are putting their family inside a house.
But John A. Wood, director of Kansas City’s Department of Neighborhoods and Housing Services, sees the “huge swaths of land that are suffering disinvestment,” he says.
“If you want to stop the city’s bleeding, you have to reverse that,” he said. “We’ve got to be bold.”
That could mean more financial assistance to investors.
The difficulties are many. Many of the investors are out of state, Wood said. And not all local investors are worthy. Some are taking advantage of renters. Some are enticing them with contract-for-deed setups that put ownership responsibilities on renters, but give them no equity for their payments. All is lost by the renters if they don’t fulfill multi-year contracts.
The city has to have private and public partnerships to help finance so much rehab work, he said, but there is a reason banks on their own hesitate to do business with these properties.
The loans are too small and too risky for most of their lending guidelines. Investors’ construction costs are no less than in any other neighborhood, but the appraisal of the end product will suffer from the property values around it.
“There’s the math of that,” Wood said. “The economic reality.”
The answer will rely on shared risk, bringing in a consortium of banks along with nonprofit renewal corporations, including Kansas City’s AltCap. Kansas City has seen this kind of collaboration before.
“There are real opportunities to deploy capital into underserved communities,” said Ruben Alonso III, the president of AltCap, a community development financial institution.
AltCap is preparing to launch a small contractor loan fund by the end of the year and a home mortgage project early next year, he said.
The help comes too late for Evelyn Fields Day, 70, and her family.
From her porch across the street, she watches what has befallen the house that was her mother’s, where she spent her young adult years and where her children grew up here on the 3000 block of East 20th Street.
“I’m ashamed it went that way,” she said.
It hurts to see foliage in the gutters, “dangerous building” warnings stenciled on its boarded windows and so much tree and shrub growth to all but hide the steps and porch.
But the family members who took on the house after her mother died in 1999 didn’t help it, and Day and her sister tried but couldn’t keep up the payments on the house while also paying on their own.
An investor they don’t know, Chris Murray in Grandview, bought it as part of a large portfolio of properties he had been managing. Renters came and went for a while.
But Murray said he’s out of the business now.
“I had to get out,” he said. “It was too hard. I had to do what was best for my family.”
The house on 20th Street, as well as others of his properties, passed through a Florida bank.
Someone bought it this summer on the courthouse steps. Paid $1,103.34 for it — the amount of past due taxes, the minimum opening bid.
Maybe it’s a long shot. But for Day’s mother’s house, it’s another shot.