Islington Council is the latest in the UK to announce a radical scheme which will see the number of empty properties reduced and funding towards more affordable homes. It is common knowledge that many domestic and overseas investors have been buying up UK property for some time. Unfortunately, not all of these properties are available to the rental market and therefore the number of empty properties across the UK has increased dramatically over the last few years.
Perhaps one fact which has gone unnoticed by many people is the number of luxury homes which are empty while many people still struggle to find long-term accommodation. Islington Council is looking to reduce the number of empty properties under its control as well as asking landlords of empty properties to contribute towards more affordable housing.
Could this plan work?
The fact is that in this day and age it is bizarre to learn that the number of empty properties continues to rise as the number of council properties continues to fall. Many people are struggling to find long-term accommodation via their local council while the authorities continue to receive income via council tax, etc from empty properties. The idea that landlords of empty properties should be forced to contribute towards more affordable social housing is not new, it is controversial but at worst it could force many buy to leave landlords to think again.
Quote from PropertyForum.com : “Lord Heseltine, a leading figure in the UK political scene, has today suggested that UK mortgages should be capped in line with wages. This is not the first time that such a cap has been proposed by politicians although unfortunately in a free market it is proving very difficult to push through.”
The fact is that the issue of empty houses is not unique to London and we are seeing more and more across the UK. It is unlikely that councils will receive significant funding from homes which remain empty (assuming these regulations are rubberstamped) but at worst many of these properties will be put up for rent. This will then help to address the issue of limited social housing and take pressure off various councils which are struggling to meet housing demand.
Is it fair to leave homes empty?
Whether we like it or not the fact is that once somebody buys a property they can pretty much do with it what they like within the regulations. They can rent out the property, they can live there themselves or they can maintain it as an empty investment going forward. From a moral angle it does seem bizarre to see investors paying good money for properties which will never reach the rental market. At best landlords are missing out on a significant amount of income!
The major problem is that in the UK, in line with many countries around the world, we operate a free market which has free market rules and regulations. Once we start dictating to various investors what they can and what they can’t do, outside the norm, where does this stop? It is the very free-market element which attracts so many investors to the UK and reducing or eliminating this for “empty properties” could be counter-productive in the longer term.
It is very tricky finding a balance between social housing requirements and the growing number of empty properties across the UK. The fact is that UK government sold off tens of thousands of council houses in the 1980s which many believe has led to the current housing problems. There are legal and there are moral issues to take into account here and it will be interesting to see how this particular issue evolves in the future.