Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Economic Blight

What it is:

Economic blight occurs when an area of a town shows visible signs of age, disrepair, and crime.

How it works (Example):

For many people, thinking about the "bad side of town" is to think about economic blight. Often, blighted areas contain vacant or boarded-up buildings, weedy sidewalks, broken windows, and crime. Blight occurs when businesses leave an area of town, taking jobs and property tax dollars with them. The residents of those areas are more likely to be unemployed as a result. Unemployment tends to trigger other characteristics of blight.

Why it Matters:

Blight is more than just an opinion; many municipalities have legal definitions of blight. For this reason, blighted areas may be subject to eminent domain laws, in which municipalities can seize property and sell it or redevelop it in a manner that will generate more property tax revenue and be more visually appealing or attractive to businesses.