The Big Issue has backed the creation of a nation-wide empty homes scheme, advocating for the potential of the UK’s empty spaces as a key measure to combat the raging housing crisis. Published in partnership with Resonance, the report highlights the contradiction between England’s urgent housing demand and it’s wealth of empty spaces, with over 309,000 long-term vacant homes.
Whilst this many homes lie empty, there are more than 130,000 households living in temporary accommodation, a situation that cost local authorities more than £2bn in 2023/34. The report estimates that for the cost of 1 new build home, the same investment could bring 2.6 empty homes back into use, effectively doubling the number of homes delivered for the same cost. At a time of such desperate housing need, the prospect of doubling housing output is one that demands attention.
The proposal is not without barriers, chief amongst these being a lack of currently available funding. Homes England’s Empty Homes programme offers grants of £10,000 per property for Registered Providers, in comparison to an average of £139,000 per new build. Despite the disparity between the two figures, both processes must deliver housing to the same high standards, creating a difficult environment to justify the necessary retrofit works.
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Tax costs are also highlighted as a barrier to the necessary redevelopment of empty homes. Empty home purchases face a 5% Stamp Duty Land Tax (SDLT) surcharge for landlords and social-impact organisations without charitable status, including CICs and social impact property funds. By comparison, building new has no SDLT. Refurbishment works by these providers are subject to 20% VAT, whereas qualifying new-build construction benefits from a 0% VAT rate. The report argues that the current fragmented framework of government support for restoring empty properties hinders the ability of councils to restore vacant properties, and creates a structural bias towards new builds.
The report ultimately calls for a joined-up strategy to galvanise the restoration of England’s empty homes, built upon a £2bn funding allocation for Strategic Authorities and Local Authorities. Such a fund could support the delivery of 40,000, with an average investment of £50,000 per home, less than 40% of the public investment cost for new builds, on average. The report points to the government’s current SAHP funding allocation, aiming to support the delivery of 300,000 new build properties at an average government investment of approximately £130,000 per home, and highlights the higher cost effectiveness of this lesser funding allocation, that would return 2.6 empty homes to use for the same cost as 1 new build property.
The report argues the proposed funding should be allocated to strategic authorities, or local authorities where they do not exist. These authorities should have the necessary decision-making powers over the funding, in line with the government’s current devolution agenda. This proposal would mean that funding can be allocated as necessary to what would undoubtedly be a nuanced and area-specific initiative, as well as meaning homes can be designated for social rent or temporary accommodation where necessary.
The report details a number of other suggested measures, aimed at removing current barriers around empty homes and supplying resources and incentives to bring the homes to market. Amongst these measures are the reduction of stamp duty for purchasers where properties are used to meet local demand for social housing, a fully-funded local authority duty to investigate and act on long-term empty homes complaints and the development of empty homes-specific enforcement powers.
