From Ghost Cities to Tipping Points: Understanding America's Vacancy Crisis

Ghosts may not be real, but ghost cities are.

Haunted houses and ghost towns are staples of spooky season. In daylight, these properties show telltale signs: boarded-up or broken windows, structural damage from fire or neglect, missing roof sections, and overgrowth of trees, grass, and vines. While these images raise goosebumps among passing trick-or-treaters, code enforcement departments and urban planners track them year-round. Urban decay and housing vacancies can devastate entire neighborhoods if left unaddressed, especially as cities approach the urban vacancy tipping point.

Researchers tracking urban vacancy have developed a tool to measure when vacancy tips into urban decay: the Ghost City Index. By overlaying nighttime satellite light data with built infrastructure maps, researchers can identify areas where buildings exist but few people live. When cities are dark at night despite having infrastructure, it signals a ghost city, a place with high vacancy rates despite development.

The metric is straightforward: when the population-to-built-up-area ratio falls below 0.5 (or 5,000 people per square kilometer), a city qualifies as a ghost city. The study that developed the index evaluated 8,841 cities worldwide, with some showing vacancy rates as high as 47%.

While U.S. cities don't face vacancy on that scale, most struggle with vacant properties, urban decay, and absent landlords. The critical question is: at what point does vacancy become an urban decay crisis? And, what steps can be taken at different stages? 

America's Vacancy Hotspots

The U.S. has a number of great spooky ghost towns. A few of the most famous have histories intertwined with vacancy and violence.

• Brodie, California - an abandoned gold rush town frozen in time with historic buildings, personal belongings, and enough paranormal activity to give the Ghost Busters a second location. 

• Centralia, Pennsylvania - with only 5 residents remaining from the original 1000 population in the 1980s, this condemned town has a literal fire burning beneath it, causing sinkholes and lethal levels of carbon monoxide. Centralia was a coal mining town with an infamous history of murder, arson, and cursed land even before the fire started in 1962.

• Ruby, Arizona - an abandoned mining town established around 1877 near the border with Mexico. The mines produced gold, silver, lead, zinc, and copper. When the Mexican Revolution erupted in 1910, the town was hard hit by the sprawling lawlessness. Then, in the early 1920s, three double homicides, deemed the Ruby Murders, ended in the largest manhunt in the Southwest.

Excluding ghost towns, the U.S. vacancy rates vary dramatically by region and city type. At a regional level, the areas with the highest vacancy rates are 

• Cape Coral-Fort Myers, Florida, leads the nation with a 38.7% housing vacancy rate, followed by 

• North Port-Bradenton-Sarasota at 23.7% and 

• Miami-Fort Lauderdale-West Palm Beach at 14.7%. 

Many Florida metros have high vacancy rates due to seasonal housing patterns, but other cities face vacancy driven by population loss and economic decline.

SmartAsset’s study of the 343 largest cities in the US shows some staggering vacancy rates:

• New Orleans reported the highest vacancy rate among major cities at 22.9% in 2022, with 44,746 vacant housing units—nearly 8,000 more than in 2017. 

• Detroit's vacancy rate sits at 21.9%, though the city has made progress, reducing vacant units from roughly 99,000 in 2017 to 68,048 in 2022. 

• Baltimore, with approximately 15,000 abandoned properties, has the third-highest rate of vacant and abandoned properties in the country, at 7-8% of its total housing stock.

Commercial real estate faces similar challenges. Office vacancy rates hit a 30-year high of 20.1% nationally in 2024, with more than 900 million square feet sitting empty. San Francisco leads with a 29.3% commercial vacancy rate, followed by Austin (27.8%) and Seattle (26.4%).

The Tipping Point: When Vacancy Becomes Contagion

Not all vacancy is created equal. In fact, cities face a critical risk as they approach the urban vacancy tipping point. Research shows that property abandonment follows a non-linear pattern, with specific thresholds that accelerate neighborhood decline.

A 2019 study by Hye-Sung Han examining housing abandonment in Baltimore from 1991 to 2010 found that the impact of vacant properties doesn't increase proportionally. Instead, there are critical tipping points. Property values drop sharply when more than two abandoned properties appear within 250 feet. The marginal impact continues to increase until reaching 14 vacant properties within that same radius, after which the effect levels off.

"Distribution of abandoned residential properties in Baltimore, Maryland, 2010." Source: Han, Hye-Sung. (2017). Exploring Threshold Effects in the Impact of Housing Abandonment on Nearby Property Values. Urban Affairs Review. 55. 107808741772030. 10.1177/1078087417720303. 

"Nonlinear impact of housing abandonment." Source: Han, Hye-Sung. (2017). Exploring Threshold Effects in the Impact of Housing Abandonment on Nearby Property Values. Urban Affairs Review. 55. 107808741772030. 10.1177/1078087417720303. 

Other research suggests an even lower threshold. Johns Hopkins researchers studying Baltimore found that 4% vacancy represents the critical tipping point.  With Baltimore's citywide vacancy rate at 7%, and certain neighborhoods exceeding 30%, entire communities have crossed this threshold.

"One vacant house does not change a neighborhood…But if you reach 4% of properties being vacant, that is the tipping point. Beyond that, things go south very quickly." - Mary Miller, Senior Fellow, 21st Century Cities Initiatives at Johns Hopkins University

Source: Baltimore Neighborhood Indicators Alliance via Federal Reserve Bank of Richmond

The cascading effects include increased perceptions of disorder, heightened fear, reduced social cohesion, and accelerated abandonment. These factors create a feedback loop: as more residents leave, remaining properties lose value, making it even harder to attract new investment or residents.

The Cost of Inaction

Baltimore's vacant properties cost the city over $200 million annually in lost revenue and direct expenses. The neighborhoods with the highest vacancy rates are Sandtown-Winchester/Harlem Park (31%), Southwest Baltimore (29%), and Greenmount East (27%).

Addressing vacancy at scale requires substantial investment. Baltimore's new 15-year, $6.2 billion housing redevelopment program aims to revitalize more than 37,000 vacant or at-risk properties. The program is supported by $1.2 billion in public investment and will leverage $5 billion in private-sector financing. Baltimore Mayor Brandon Scott reduced the city's vacant property inventory by 14% by investing $146 million in neighborhoods, largely with American Rescue Plan Act funding. 

“Previously, the City invested $7-8 million per year to address vacant properties. At that pace of investment, it would take at least 300 years to solve this problem. We can’t afford to wait three centuries.” - Baltimore City

Strategies for Managing the Urban Vacancy Tipping Point

The critical questions: at what point does vacancy become a crisis, and what can you do about it at each stage? The answers vary by stage.

 Vacancy isn't binary; it's a spectrum that requires different interventions at different stages.

For Neighborhoods With Low Vacancy 

Low vacancy, well below the urban vacancy tipping point, is when an area has below 4% vacant properties or fewer than 2 vacant properties within 250ft. When vacancy rates remain low, prevention is the most cost-effective strategy. The goal is to identify and address problem properties before they trigger the cascading effects that lead to neighborhood decline.

Early Detection: Municipalities can identify at-risk properties before they become crisis points through regular visual surveys, tracking patterns in 311 complaints, and maintaining vacant property registries. By mapping clusters of code violations (overgrown yards, broken windows, peeling paint, structural deterioration), cities can spot emerging vacancy hotspots. 

Early Intervention: Educational approaches can prevent properties from deteriorating in the first place. Stockton, California, has an educational outreach program called Revitalizing and Improving Stockton through Education (RISE), which uses City Detect’s data and photographic evidence to send courtesy notices to property owners about minor violations before issuing citations. The goal of the program is to increase voluntary compliance. They are achieving their goal by regularly hitting around 80% voluntary compliance with the educational notices. Studies show that educational notices can reduce a code enforcement’s administrative overhead budget by up to 15%. Additionally, complementary initiatives like graffiti removal programs and abandoned vehicle abatement keep neighborhoods looking maintained, reducing the visual cues that signal decline. These softer interventions give property owners a chance to address issues voluntarily while demonstrating the city's investment in the community.

Strategic Enforcement: When educational approaches don't work, swift legal action may prevent further deterioration. Code enforcement teams that prioritize intervention based on clustering patterns, addressing multiple violations on the same block simultaneously can prevent the cascading effect. Enforcement tools include violation notices, citations, escalating fines, and vacancy taxes that make abandonment financially costly for property owners.

Vacant Property Registries: Vacant property registries are an important benchmarking and transparency tool many cities are implementing. Cities leveraging vacant property registries include Reading, PA, Wilmington, DE, Baltimore, MD, Sacramento, CA, and many more. Maintaining registries of vacant properties and establishing clear timelines for remediation keeps property owners engaged and prevents long-term abandonment. Using a technology-based service like MuniReg’s vacant property registry can accelerate the implementation of a registry. 

Vacancy Taxes: One study suggests that a vacancy tax can result in up to a 13% decrease in vacancy rates. Washington, DC charges much higher tax rates for vacant properties than occupied ones, making it financially painful for owners to leave properties empty. San Francisco’s vacancy tax, enacted in 2019, correlated with over 2,000 vacant properties returning to the rental market. Global cities like London, England, and Vancouver, Canada, also have vacancy tax policies that have proven effective. This policy incentivizes owners to either maintain and occupy properties or sell to those who will. While increasing taxes is always controversial, cities that use vacancy taxes to push back against the urban vacancy tipping point have found them to be a useful tool in their toolbox. However, it is worth noting that a vacancy tax alone is not enough. Tax policy must be paired with other interventions to successfully abate vacancies.

Source: Vancouver Annual Report 2024 via Green Builder 

The principle is straightforward: prevention is easier and cheaper than revival. Once a neighborhood crosses the 4% vacancy tipping point, the cost to stabilize and restore it increases exponentially.

For Areas With High Vacancy (Above 4%)

Cities already struggling with high vacancy rates need more than early detection; they need strategies that work at scale. When vacancy has already reached the tipping point, cities need comprehensive, large-scale interventions that go beyond traditional property-by-property approaches.

Whole Block Strategy: Instead of addressing properties one-by-one, Baltimore's approach tackles entire blocks at once. This strategy, called a “Whole Block Approach,” systematically lifts entire neighborhoods, which is hoped to be far more effective than piecemeal efforts. By focusing investment on complete blocks, cities can create a visible transformation that attracts additional private investment and prevents the surrounding properties from declining.

Land Banks: Detroit's land bank has acquired and sold more than 20,000 vacant structures and 23,000 empty lots since 2014. Land banks are quasi-governmental entities with special powers to acquire properties, clear titles, and transfer to new responsible owners more efficiently than traditional city departments. They can bundle properties together to reduce costs and help developers move forward in neighborhoods they might otherwise avoid.

“An abandoned house is transformed in Detroit’s East Village neighborhood, a testament to the city’s resilience and renewal.” Source: Roadmap to Recovery, City of Detroit

Strategic Demolition: Detroit used aggressive demolition to reduce the total housing stock, helping bring supply and demand into better balance. Rather than demolishing randomly, cities should focus on properties that pose public safety hazards, cannot be economically rehabilitated, or can be cleared to create usable green space that improves neighborhood quality of life.

Dual Subsidy Programs: Cities need two types of subsidies: one for developers to rehabilitate properties in weak-market neighborhoods where costs exceed potential returns, and another for residents to help them become homeowners. Baltimore's proposed programs recognize that market forces alone won't restore high-vacancy neighborhoods.

Accelerated Acquisition Tools: In-rem foreclosure processes and other fast-moving legal powers can help cities simultaneously move several properties in capital-deprived neighborhoods. When bundled together, this approach reduces transaction costs and creates economies of scale.

The Bottom Line: Investment at Scale

Early detection prevents crises. Strategic enforcement stops the spread. But once neighborhoods cross the tipping point, recovery demands something more.

The hard truth: high-vacancy neighborhoods need sustained, substantial public investment. Baltimore estimates it will take $2.5 billion in public funding over two decades to address its vacant housing crisis, leveraging an additional $4.4 billion in private capital. The city's current $6.2 billion, 15-year housing redevelopment program aims to revitalize more than 37,000 vacant or at-risk properties.

Ghost cities aren't just a phenomenon in rapidly urbanizing countries. They're emerging in American neighborhoods, one vacant property at a time. But unlike the haunted houses that vanish after Halloween, real vacancy crises don't disappear on their own. The good news? Whether your city is at 2% vacancy or 20%, there are proven strategies for every stage. The difference between a stable community and a declining one comes down to action—matching your intervention to where your neighborhoods are on the vacancy spectrum, and starting now.

This Halloween, while trick-or-treaters admire the fake cobwebs and boarded windows, code enforcement departments have the tools to ensure those remain decorations, not predictions.