As avid readers of Lib Dem Voice will know, tackling the scourge of empty homes has been high up my agenda since entering government. Empty Homes bring down communities, and doing something to tackle this growing problem was one of our big housing “asks” in the coalition negotiations. Previous governments hadn’t paid empty homes much heed at all, with the numbers left to soar, peaking in 2008 at 783,000. Labour’s failed Pathfinder scheme had set out to demolish thousands of homes, but ran out of cash, leaving some families marooned on what had become “ghost streets”. I was determined that this government was going to be different.
We started back in October 2010 with two key announcements. The first was that we had secured £100m in the CSR for the first ever government empty homes fund. This fund was designed to bring empty homes back into use as affordable housing, with an initial estimate of 3,300 properties being brought back into use. The second was the announcement that the rules for the New Homes Bonus had been tweaked (at my urging), so that councils would be rewarded in exactly the same way for bringing empty homes back into use as they would for building a new home, an important incentive.
Then, at our Autumn Conference in Birmingham, I announced that we would consult on plans to allow councils to charge extra council tax on long-term empty properties through the empty homes premium. The proposals will allow councils to charge up to 50% extra on any property left vacant for two years or more.
By November, we’d published our empty homes strategy. This was the first time that a government had ever had an empty homes strategy, and was announced alongside an extra £50m (now boosted to £60m) to tackle localities with large “clusters” of empty homes, primarily in the north. Finally, last month, I announced the appointment of George Clarke (presenter of the Great British Property Scandal on Channel 4 and an empty homes campaigner) as the government’s independent advisor on empty homes. George will work with me to promote the renovation of empty properties over demolition, and act as an ambassador and trouble shooter.
Now, we’re moving on to the delivery. In February, I awarded the first £70m of the £100m empty homes fund, to local authorities and other registered housing providers to bring properties back into use as affordable housing. Where we once envisioned bringing 3,300 homes back into use with the £100m investment, we’ve been able to use just £70m to bring 5,600 back into use. Projects are now getting underway to make this happen.
Today I spoke at the national empty homes conference in Birmingham, and was able to announce the successful bidders for the remaining cash. Just over £25m will be shared amongst community groups, whilst £60m from government will be match-funded to £120m by local partners, taking the total investment so far to £215m. A further 5,600 empty homes will be brought back into use across the funding streams announced today, taking our total to 11,200, with £5m still in the bank to be spent at a later date. I was also able to confirm that we’re going full speed ahead with the council tax changes, and the empty homes premium, so councils will soon have extra weapons in their arsenal to tackle the problem of empty homes – and will no longer have to forgo £420m or more in council tax payments due to mandatory discounts.
So far, our efforts seem to be paying dividends, with long-term empty homes (properties vacant for more than six months) falling by 21,000 to their lowest level since 2004. But they still stand at 278,000. That’s bigger than a city the size of Sheffield. We need to do much more to tackle this problem and this government is determined to breathe life back into these neglected neighbourhoods up and down the country.
* Andrew Stunell is the Liberal Democrat MP for Hazel Grove, was a member of the all-party parliamentary inquiry into electoral conduct and is a former communities minister.
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16 Comments
there are 1.8 million families on waiting lists, overall 4.5 million people. whilst the efforts on empty homes are good it is a drop in the ocean in dealing with the housing crisis. add to that the fact that many empty homes are in places with lower demand, and the areas with the longest waiting lists are typically in areas with fewer people on the lists, and it is easy to see that much more that needs to be done to actually build hundreds of thousands of affordable (ie actually affordable, not at 80% of extortionate private sector rents that force people onto benefit to pay them) homes in areas where they are needed.
local gvt worker, you are quite right.
The problem is that anything which more effectively deals with the problem would be met with streams of abuse, sob stories about poor little old ladies being thrown out of their big homes, anger about “concreting over our countryside”, anger about “tax-mad politicians” etc etc.
One of the problems with this coalition is that if the LibDems do suggest something a little leftish, the right-wing press responds with howls of anger, the political left outside the LibDems responds with – well, nothing on a good day, and making an opportunistic alliance with the political right to pour abuse on the LibDems on a bad day (see the last Budget).
You quote the total number of empty homes under Labour’s watch, but only the long-term figure under the Coalition’s. Come on Andrew, can’t we have a bit more transparency than this?
There’s lots I agree with as far as it goes. Empty homes are a waste and ideally they’d be in use. In particular, removing council tax exemption from empty properties is a very welcome reform, as it makes council tax more like a property tax than a poll tax. More in that direction please.
But local gvt worker’s point can’t be overemphasised. There are few empty homes in the areas where housing is most needed. The sheer cost of housing here in Oxford is crazy and causing real hardship, and while I do know of the odd empty home here and there, the real problem is the appalling housing conditions that many find themselves in because there’s no other option.
Well put Duncan.
A welcome reform would be to require that Council Tax is paid by the property owner, not the tenant. This would be a massive simplification for council administration in places like Cambridge with a large turnover of private tenants.
We don’t need an Office of Tax Simplification to see the value in this one.
These figures show that two-thirds of empty homes are not empty for very long. A person ends up buying one house before selling the previous one, (this happened to me, and I ended up owning an empty house, for a few weeks). Two people with houses come together to form a single household, and put one house on the market. A person is in hospital for an extended stay, or gets posted abroad for a few months. Or the house is being renovated. Or someone dies, and the will has to be sorted out, the house sorted out, marketed, and sold. None of these is a scandal, in any sense.
In an ideal world we would not have 200k empty for the long term, but this number is very, very low by international standards, as the Barker Review made clear. There are reforms to probate that would allow us to reduce the time for which a house is vacant after the owner dies. This would help at the margin.
As others have said, what we need is house building on a decent scale, concentrated in areas where housing is scarce.
I strongly echo local govt worker’s and Duncan’s points here (well in fact everyone’s points really). Empty homes are often empty because they are in areas where demand for housing is low. Yes, bringing them back into use and reducing or abolishing 2nd home discounts is all very well, but the whole problem, Andrew, is that you’re patching up a small leak when there’s a giant gushing gap behind you where far more water is coming in.
Now a truly brave move would be to prevent foreigners buying up central London’s housing stock as a safe investment in these troubled times (53% of home sales in central London last year were to foreigners). How about a requirement that in the GLA area, or even some boroughs within it, were allowed to ask for a British passport as a condition of sale?
Or, even more radical, how about you stop saying that you are building more social housing than any govt since 1979 and admit that this is only because you have redefined social housing to include what we would otherwise have called intermediate housing – ie homes that people on genuinely low incomes can’t afford to rent.
I know it’s not all your fault , Andrew, it’s the Big Blue nasty lot and their remarkably dissembling (‘rents are falling in London’) Housing Minister, (No-)Grant Shapps, but scoring an EH victory when the housing starts reach an even lower all time low, security of tenure and rising rents are advocated by yellows in Government (shamefully) and ‘Pay-to-Stay’ puts the nail in the coffin of the aim of mixed communities once and for all, there really are bigger fish to fry.
Must try harder.
I don’t think we can ban EU citizens from buying property. Also, central London is a small part of the stock – what is the number (in absolute terms) of houses sold to foreigners who are not living here (a foreigner living here and working here is different)? I suspect that this is a minor as empty homes.
This is welcome news and good policy. How comes that we Liberal Democrats always have to find faults with everything? It might be minor, but it is important, and in small communities up and down the country even 3 or 4 empty houses put back on the market will make a big difference: there is life beyond London!
This on its own is not going to solve our housing crisis, and the need for more genuinely affordable rented homes. But Andrew does not say it is.
The empty homes strategy was described at a meeting of our local Housing and Neighbourhood Partnership as “Win, Win, Win”. We may not have as much need for housing as other parts of the country, but in the North East we have real people in need of housing, and every one of those people matters. We have big problems with the problems of anti social behaviour around empty property issues. We have a lack of jobs, and in addition to providing jobs in bringing these empty homes back into use, there have been 30 one year apprentices created by a local not for profit organisation working with youngsters, also a scheme for “introduction to construction” being run as part of this, gives free training and a guaranteed job interview at the end.
Experience here really does say “win, win, win”.
We’re talking here about areas where demand is low having empty housing and areas of high demand having generally horrible conditions and costs, yet no-one seems to be talking about wider efforts to rebalance economic demand?
There is little sense in simultaneously paying to dismantle the north and to further urbanise the south. Studies on the concept of goverment-funded regional development banks along the lines of the German Landesbank to take up the excess productive capacity in which the private financiers are underinvesting in the regions show it would provide a clear net positive return and a boost to national economic growth, while also helping to rebalance our population more effectively to the available infrastructure.
Exec summary – don’t just look at the homes, that’s addressing the symptoms. Address the causes too, rebalance the economy away from its SE focus and get a better return for less cost.
We of the older generation remember the Prefab as the successful solution to a homeless crisis sixty years ago. These were economically mass produced prefabricated in factories after the style of today’s “Park Home”; They were a stop gap designed to solve the post war housing shortage which was more severe then than today. Within fifteen years most tenants had been rehoused in bricks and mortar and the prefabs having served their purpose were demolished.
On the down side they looked ugly and were cramped for a family with children but the homeseekers of that time welcomed them because they were dry , warm, comfortable and infinitely better than being homeless or living with ‘the in-laws’
Many tenants were reluctant to leave and there are still some refurbished versions around today.,
Andreww fails to mention that Labour’s Pathfinder scheme was part of the problem – it created whole neighbourhoods of empty homes, just so that they could be demolished; it being cheaper to demolish and build new than to renovate as new build didn’t incur VAT.
It has been obvious for many years that the exclusion of VAT on new build is an anomaly that should of been removed years ago.
I am not convinced that giving grants to people to let empty homes is a great use of money. Better to tax them with Land Valuation Tax. Gosh do Lib Dems have a party policy on that ? They do ! As other have pointed out the empty homes are often in the ‘wrong’ places or empty for a legitimate reason. Sometime they are just investments and peolpe don’t want the hassle and risk of bad tennants. The 80% market rent is quite the most absurd policy to be advocated by a Liberal Democrat Minister – and that is Andrews Department. Net immigration is running at 1/4 of a million people a year, the scale of pent up demand is huge, and this is really Blairite tinkering at the edges of the problem.
Suzanne – it would be win, win, win except that it costs £19k per house. If we had just given your local council £19k, would you have chosen to spend it reducing the number of empty houses by 1? Maybe you would, maybe you wouldn’t, but as a localist I would rather give you the money and let you make the decision.
New build does not incur VAT but does pay stamp duty, whereas extensions pay VAT but don’t pay stamp duty until sold. Houses that are done up and then sold pay VAT and stamp duty, but the builder can reclaim the VAT. So everyone pays one or the other – not perfect, but it would be odd to make one pay twice or one pay neither.
Greg Webb – where is this evidence? In all my years looking at these issues I have never seen such evidence.
I think council tax premiums on empty houses have to be worked out carefully. We need mechanisms to get property owners who intentionally leave property empty to either sell, let out, or renovate to let out. But we must be careful not to punish people simply for being in a difficult situation.
We have had to move abroad for employment reasons, and have a furnished house in West Yorkshire. We’ve done our best to let this out, but this has involved periods where the property was unoccupied. During this period we need to pay gas and electricity and 90% of council tax.
Currently we’ve gone for a longer period because our previous tenant didn’t look after the property. It wasn’t particularly abused, but was left looking worn and needing repairs. During the final weeks she would not answer the agents calls and let them view the property (probably because she was busy cleaning).
So… we have an empty property for two months through no fault of our own. What we could legitimately claim from the bond for excessive wear and tear doesn’t cover the mortgage interest, council tax and bills in that period.
Were we to leave the house unfurnished, we could pretend to be doing renovations. Were I to lie and claim to have gone back to the UK alone for 2 months, I could claim a bigger discount.
Perhaps if the premium on long term empty houses was levied then we could look at a system that doesn’t penalize people for being unlucky with their tenants.
I’m vaguely in favour of making council tax a tax on property again, but can see complexity in this regard. If it’s the landlords expense then rents have to go up to cover it. Do we then lose all exemptions for students, individuals living alone etc- or do the landlords then have to claim these allowances and lower rents accordingly. Property management companies may not be in favour of that as they set fees on a percentage of rent. Making these companies manage council tax on owner & tenant’s behalf is a recipe for disaster given the capabilities of companies in this sector.