Empty homes being recorded as holiday lets by owners who want to avoid paying council tax on them is to blame for an apparent drop in the numbers of vacant properties recorded across the country.
The group Action on Empty Homes claim that without this practice of ‘flipping properties’ the number of empty homes recorded nationally is actually 20 per cent higher than it was five years ago.
According to AEH the number of long-term empty homes (vacant for more than six months) has risen from 200,145 in 2016 to 238,306 in 2021. This means long-term empties are now at their highest level since 2012, if the exceptional rise during the housing market shutdown caused by the pandemic (2020 data) is ignored.
The group is drawing attention to the data ahead of its national focus on what it terms as ‘this wasted resource’ during Empty Homes Week 2022, which this year is taking place from 28th February to the 6th March. This year there is an emphasis on retrofitting empty homes and bringing them back into use for social rent and genuinely affordable housing.
While national totals released by Whitehall appear to show the number of ‘second homes’ falling by around 10,000 in the latest 2021 data, AEH claim that true figure actually rose as over 11,000 second homes had flipped their status to show them as holiday lets. In places such as Cornwall, AEH says that as many as 1 in every 18 properties are unavailable either by virtue of being a holiday let, second home or being left empty in the long term.
Homes classified as holiday lets are no longer part of the residential property council tax base and instead become liable for business rates. However, AEH estimate that the owners of as many as 96 per cent of such homes can avoid paying local taxation altogether due to generous business rates discounts introduced by the Government.
This scheme ostensibly designed to protect small local businesses is now being exploited by the owners of more than 67,000 properties in England which are now classified as holiday lets. Adding these to the national total of 253,000 second homes means that across England the second homes and holiday lets market has sucked over 320,000 homes out of residential supply.
Will McMahon, director of Action on Empty Homes, said:
“In the last five years we have seen an escalating housing crisis while the number of long-term empty homes and second homes keeps rising. This year’s figures seemed to show second homes numbers dropping at a time when communities around the country were reporting the opposite – now we know why.
“It turns out this isn’t happening at all, they are just switching to business rates in huge numbers to dodge council tax and avoid penalties for being kept empty.
“Today there are nearly 100,000 families and over 120,000 children stuck in overcrowded and insecure temporary accommodation because of a shortage of social housing. Yet over half a million homes have no one living in them because they are either long-term empty or are used as holiday lets.”
While around 1million homes currently have no-one living in them, over 550,000 long-term empty homes, second homes and holiday lets are without residents in the long-term, he added.
By Patrick Mooney, Editor