With an estimated 200,000 empty homes across the country, worth around £43bn, Phillip Hammond has handed local authorities more power to tackle the issue.
In his speech, Hammond said councils would be able to charge a 100% premium on council tax on empty properties in a bid to stop property investors from leaving homes empty.
He said: “It cannot be right to leave property empty when so many are desperate for a place to live.”
The current 50% cap on council tax for such properties will be scrapped, which could help with the housing shortage experienced by many.
Karen Barrett, CEO of Unbiased, said: “This announcement should be welcomed by renters struggling to find affordable accommodation, and may also bring more properties onto the market as owners choose to sell rather than pay the premium.”
The term ‘buy-to-leave’ was first put in the spotlight after the Grenfell Tower disaster, which left hundreds homeless. It was revealed that the borough of Kensington and Chelsea had 1,652 unoccupied properties, including those owned by oligarchs, foreign royalty and multimillionaires, and many of which were a short distance from the Grenfell tower block.
Jeremy Corbyn called for some of the empty properties to be requisitioned to be used by Grenfell Tower survivors.
What is an empty home?
Before today, the council could charge up to 50% extra council tax if your home had been empty for two years, unless it is an annexe, or you’re in the armed forces. Other exceptions to the rules include the homes:
- of someone in prison (except for not paying a fine or council tax)
- of someone who’s moved into a care home or hospital
- that have been repossessed
- that can’t be lived in by law, for example if they’re derelict
- that are empty because they’ve been compulsory purchased and will be demolished
You could also apply for a discount if your home was undergoing major work or structural changes, which left it empty.
If the property was derelict – not possible to live in or would need major work to make it wind and watertight – you could apply to be removed from the council tax valuation list.
There were already a number of schemes set up across the country to try to tackle the issue of empty homes locally, including the Empty Homes Plym scheme in Plymouth, and a grant from Newcastle City Council to encourage empty home owners to get them occupied.
Second home owners at present can pay less council tax on a property that isn’t their main home, and local authorities can give furnished second homes or holiday homes a discount of up to 50%.
Jane Streather, cabinet member for housing and public health, Newcastle City Council said: “An empty house is a wasted resource that brings no benefit to the owner. An empty property can be an eyesore, have a negative impact on the neighbourhood and lead to anti-social behaviour, which is why a proactive approach to helping owners turn empty houses into homes is so important.”
It is unclear yet what exactly the changes will be following the Autumn Budget in terms of who will be affected and where the threshold will lie for the council tax penalty. The announcement today has left many confused over what the council tax levy will actually mean.
100% council tax premium on empty properties to be allowed. What is an empty property? Is a holiday home an empty property? #Budget2017
— Merryn Somerset Webb (@MerrynSW) November 22, 2017