As the housing shortage in the UK continues to grow with more and more people forced to rent as they can’t afford to buy, the Audit Commission has revealed that councils across the UK own some £2.5 billion worth of property assets which are not being used. When you bear in mind the political arguments surrounding the number of new homes built across the UK each year, surely UK councils should be making better use of their surplus property investments?
There are a number of options open to UK councils with significant surplus property which would benefit the wider public, assist local property markets and potentially bring more affordable homes to the attention of the general public.
Converting into homes
It is not clear what types of property have fallen under the investigation by the Audit Commission but surely there must be some surplus properties which could be converted into affordable housing? When you bear in mind the number of council house properties which have been sold off since the 1980s perhaps it is now time to reverse this trend and encourage local councils to convert existing property assets into more widely usable forms?
Quote from PropertyForum.com : “Is the EU right to warn the UK on house price increases?”
The pressure on council housing has grown tremendously over the last few years although perhaps better management of both surplus properties and empty properties could release this pent-up demand?
Reinvesting into affordable housing
Whether or not the £2.5 billion worth of surplus assets highlighted in this report can be readily converted into homes of an affordable nature is unclear. However, at the very worst these properties must have a commercial value and we can only estimate how much an investment of £2.5 billion across the UK affordable housing market would help those struggling.
In the tax year ended 2013 it is estimated that local governments across England held property assets worth nearly £170 billion and even though this is down one third since the 2005 tax year it is still a sizeable portfolio. Historically local authorities have often been left wanting when managing their own property assets and perhaps it is time to bring in outside parties with more commercial experience who will look at it from a more business-like angle?
Squeezing the last pound out of surplus property
When you consider the number of local and national politicians criticising landlords up and down the country, how can they be sitting on £2.5 billion worth of surplus assets? The Labour Party is looking to bring in an array of property taxes aimed at raising new revenue streams from “rich property investors” which they intend to use to rejuvenate struggling cities and towns across the country. Surely the Labour Party, and other political parties, should be looking a little closer to home and squeezing every last pound out of surplus local authority properties, before blaming property investors?
It is also worth noting that while governments and politicians seem intent on introducing an array of property taxes, who was there to help property investors during the crash? When you are doing well it seems that governments are happy to penalising you further with new taxes but when you struggle and lose money you are left high and dry….. Is this really fair?