A half-finished office skyscraper dominates the skyline. It was built during the construction boom, but was abandoned during the bust. It sat empty for years before squatters decided to move in. The location? Caracas, Venezuela.
The U.S. is also now dotted with partially completed construction projects. The partially completed Centerpoint Condominium project in downtown Tempe, AZ was home to squatters for several years, although there the construction has resumed. While squatting is not currently common in the U.S. commercial buildings, it’s become very common in residential ones:
[There are] units occupied by squatters who have long since stopped paying their mortgages. No one knows exactly what the numbers are, but we can make an educated guess. According to the NY Fed, there are approximately 100 million mortgages in the US. Fannie and Freddie report that roughly 4.5% of the mortgages in their portfolios are “seriously delinquent.” That’s another 4.5 million currently occupied units that could be added to shadow inventory, bringing the potentially available inventory to 14.2 million units.
Will we see more squatters in commercial buildings? Only time will tell. Let’s not be smug and think that squatting is only a third world issue though. Our problem is just less obvious. Here we call many squatters “homeowners”.