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Restoring Empty Homes

The Guardian has written another article (Guardian, 20th April 2017) on the empty homes crisis in the UK. The article tables the numbers by value. Unsurprisingly London dwarfs all – primarily because of the average values in the capital.

https://www.theguardian.com/society/2017/apr/20/over-200000-homes-in-england-still-lying-empty-despite-housing-shortages

There are more people in the UK needing affordable homes than ever before. In England alone there is an estimated 1,688,892 households (GMB, 2014) on council housing waiting lists.

One of the main issues is that there are not enough homes in the UK to house these people and the core issue is there are not enough affordable homes for people to buy or rent. The demand for privately rented homes is so high the cost of privately renting is increasing rapidly which has lead to more people than before who are in work needing assistance with their rental payments from the government (Morris, 2014).

One argument to try and help ease the housing crisis is to bring back into use empty homes. Shelter has found 279,000 privately owned empty homes as well as 30,000 empty local authority and housing association owned (shelter 2071). There were 153,370 new homes built in 2016 (Department for communities and local government). The Barker review of housing supply stated that in England alone 240,000 homes a year are needed to keep up with household growth. Currently there is a shortfall of around 100,000 homes. If there is a way to get even 100,000 homes that are unused into use that are privately owned it would help reduce the 1.6 million households waiting for a home but it is hard to see what mechanisms the government would be willing to impose to make this work.

Some of these homes (especially in central London boroughs such as Kensington and Chelsea, Westminster and Camden) are luxury homes that will not have affordable rents. If the homes could be provided at affordable rents, are the landlords willing or sufficiently incentivised to rent them? There is a limited amount of money councils have for compulsory purchase orders.

The core issue is the amount of social housing and affordable housing in the UK is limited and Local Authorities cannot build. A lot more levers will be needed to put privately owned houses back into use again. A couple of interesting ideas from other cities include:

  • Vancouver approved a 1% tax on homes that are not principal residences and are empty for more than six months a year.
  • Barcelona fines banks €60,000 for lending for homes that have been empty for over 2 years.
There are potential mechanisms for Governments and Local Authorities to do more. However, it is not a priority for the current government or likely to be a manifesto pledge.









 

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