Ferguson home values are plummeting, and residents are feeling the pain

FERGUSON, Mo. — Peering outside the office window of his tire shop, John Zisser grumbles about the pile of burnt rubble that lies on the opposite corner of a busy intersection.

“If you come here to my shop and you see that,” he says, as gestures out the window, “is that going to give you a warm, fuzzy feeling like you want to come back here to do business?”

“Short answer: no, no it’s not,” he says.

Zisser, 55, has owned and operated Zisser’s Tires in this city since 1987. He says the still-visible damage from the November protests that followed a grand jury’s decision not to indict Ferguson officer Darren Wilson for the shooting death of teenager Michael Brown is hurting property owners. His store’s insurance is in the process of being cancelled after it was twice vandalized during the unrest, he says.

“If I sold this place today, I could probably get $300,000 for it, if anyone is crazy enough to buy. Last year, the county said this lot was worth almost a million,” he says. “The value here is all going down. There’s about nine burnt-out buildings this way,” he says, pointing. “And about four more behind me.”

Watch the trailer for Fusion’s upcoming documentary, Ferguson: A Report From Occupied Territory

Zisser is one of many Ferguson residents feeling a financial toll from the months of protests, media attention, and now another high-profile shooting. They’re worried not just about their own situations, but about the city coffers, too. The future of Ferguson, they say, is anyone’s guess.

“How much money are we going to lose?” Zisser asks. “How much money is the city and the county going to lose in taxes because of this? And how much is the school district going to lose here? They’re the biggest losers.”

For the city’s 2014 budget, approximately 20 percent of the city’s revenue came from the city’s courts, and 17 percent came through property taxes. But after a Department of Justice report found the courts were profiting off racial discrimination, the State of Missouri took over to implement reforms. Couple that with rapidly falling property values (which are used to calculate owed taxes) and it seems like key parts of the city’s business plan are falling out from under it.

Since Michael Brown’s death, the cost per square foot of a home has dropped by 47 percent in Ferguson. — MARIS home sale data

The average selling price of a home in the city has been on a steady decline since the shooting of Brown last August, according to housing data compiled from MARIS, an information and statistics service for real estate agents. Prior to Brown’s death, the average home sold in 2014 was selling for $66,764. For the last three and a half months of the year, the average home sold for $36,168, a 46 percent decrease.

The trend has continued on through this year, with the average home selling for only $22,951 so far in 2015. Another negative indicator: in the eight and a half months leading up to Brown’s death, the average residential square foot in 2014 was selling for $45.82. In the eight and a half months since Brown’s passing, the average residential square foot in the city has sold for $24.11. That’s about a 47 percent downtick in one of real estate’s core indicators.

“This is not normal for the region,” says Crista Patton, a local REMAX real estate agent who helped get these numbers for Fusion. “Last time I pulled up numbers like this for a neighborhood around here, we were seeing the market going up,” she says. “In St. Louis in general, the market is going up, and as a whole it’s almost completely recovered from the recession.”

The city admits that its finances are taking a hit, with no end in sight, due to the events since Brown’s death. “The[city’s] response to the unrest, as well as other related matters, has resulted in significant, unanticipated expenditures,” reads the city’s Comprehensive Annual Financial Report for 2014. “The civil unrest also resulted in some lost revenues… At this time, the total impact of this event on the City’s revenues and expenses is not able to be estimated.”

Ferguson native David H. Pope, 76, who has worked as a realtor in the city for 48 years, says the current situation has made it nearly impossible to attract families to the area.

“I lost a sale yesterday,” he says, blaming the shooting of two police officers in front of the Ferguson Police Department. “This whole thing has been very, very detrimental to my work and the market here.”

“When you invest,” he explains, “you look at yourself and say you want a return. You’re not gonna put your money down where you see a risk. And that’s what we’re seeing here thanks to this media attention. The more we beat the drums, the risk is only heightened, and the less people want to buy property here.”

If the situation doesn’t calm down soon, he fears, the city will see an exodus of longtime residents who don’t want to put up with it either.

“We’re gonna start seeing more foreclosures and more short sales, I’m certain of it,” predicts Terry Gannon, 63, a REMAX real estate agent who has done business here for 34 years.

“Yesterday a property owner called. He has three properties for sale, and he can’t get out. At this point, he’s ready to take a loss,” she says. “And there’s another family I work with—the family has been here for over 50 years. The dad married the girl from two doors down, and the brother lives across the street. They’re from here, and at this point they’re done… They’re gonna try to put the house on the market, even though last year it was worth $55,000, and now it’s worth only maybe $45,000.”

“It’s so sad, because this is such a nice place to live,” she says. “Now, when I tell someone about a house in Ferguson, I get one of two reactions: the first is ‘Oh no, no way. No way I would move there.’ And the second is ‘Oh I love Ferguson! It’s so nice there!’ It doesn’t sound like it makes sense, but somehow that’s become the reality.”

Daniel Rivero is a producer/reporter for Fusion who focuses on police and justice issues. He also skateboards, does a bunch of arts related things on his off time, and likes Cuban coffee.