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Extra council tax to be levied on empty homes

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Owners of empty homes could be charged extra council tax to raise income for new homes, communities minister Andrew Stunell has said.

The Department for Communities & Local Government is set to consult on whether local authorities should be able to levy an ‘Empty Homes Premium’ on houses that have been empty for more than two years, the minister told the Liberal Democrat conference this week.

Mr Stunell also promised publication of the first-ever empty homes strategy in the next few weeks and announced plans to work with local authorities on ‘homesteading’ schemes allowing would-be tenants to renovate empty homes themselves.

“We have 700,000 empty homes in this country,” Mr Stunell said. “Over 300,000 of them are long-term empties - vacant for more than six months. That’s two years’ new housing supply. It’s a scandal, in fact it’s a crime when thousands of families cannot get a decent home.”

On top of the £100m empty homes fund announced in October and made available to councils, housing associations and other providers, Mr Stunell said the government was now looking at giving councils to raise extra revenue from empty homes.

“I can announced that we will shortly be consulting on whether councils should be given the power to charge extra council tax on homes in their area that have been empty for more than two years, through an Empty Homes Premium,” he said.

The extra tax would be “discretionary” and “localist” and would have “essential safeguards and exemptions”, Mr Stunell said. “The premium will act as a spur to bring their properties back into use quickly. And where they don’t, it will provide an extra revenue stream for local authorities to plough back into bringing more homes back into use, and regenerate their area.”

DCLG could not tell LGC if the revenue would be ring-fenced for spending on empty homes. “These are new proposals - there will be more details later as part of the consultation,” a spokesman said.

Mr Stunnell said DCLG also wanted to encourage ‘homesteading’ - where prospective tenants are helped to renovate empty homes and bring them back into use - which has already been successful in places such as Newcastle and the Netherlands.

“We will work with local authorities to identify areas where effective homesteading schemes could be delivered to rejuvenate local communities,” he said.

All of the initiatives are to form a new “empty homes strategy” setting out what the government is doing and intends to do.

Mr Stunell said tackling empty homes had been one of the Liberal Democrats “big asks” during coalition negotiations and had to be better than the “disjointed, scatter-brained” policies of the previous government.

His announcements came after shadow communities secretary Jack Dromey criticised the government for going in “the wrong direction” on empty homes. Speaking at a fringe event at the Liberal Democrat conference, Mr Dromey was particularly critical of the abolition of regional spatial strategies and the decision to limit council action to homes empty for two years rather than six months.

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