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Tuesday, November 18, 2008

1m empty buy-to-let properties

According to the latest headlines in the Telegraph almost 1m homes are standing empty across the United Kingdom, and the vast majority – more than four out of every five – are believed to be owned by private landlords.

An empty home could just as easily be a rundown terrace house in an urban back street as a luxury newbuild apartment in a city centre filled with identical blocks. It might be empty because a glut of rental property means no tenants, or because vandalism, or simple disrepair, has made it unlettable.

Some landlords might be actively trying to sell, or planning refurbishment, while many have simply given up on their empty properties. Whatever the reason, the Empty Homes Agency (EHA) believes that a staggering 85pc of empty homes in this country belong to landlords. The campaigning charity plans to use this year's National Week of Action on Empty Homes, which runs from November 24 to 28, to highlight how individuals can help to reduce the number.

Figures inaccurate

These headline grabbing figures fail to reflect the true position where many properties are empty for legitimate reasons; such as waiting to be sold, completed, refurbished in between lets.

The EHA claims that there are more than 762,000 empty residential properties in England. Based on earlier figures, about 650,000 of these are believed to be owned by private landlords, and almost half of these are thought to have been empty for more than six months. The charity estimates that there are at least another 77,000 empty residential properties in Scotland, plus 50,000 each in Wales and Northern Ireland.

David Ireland Chief Executive of the EHA predicts that the total number will pass 1m in the next year. "The situation is getting worse," he says. "Even these figures were compiled in October 2007, before the property downturn led to a rise in repossessions. We're at the beginning of a trend of rising empty homes, which is what we have seen at the beginning of other recessions."


The fact is that any landlord who has a property has a massive financial incentive to rent their property rather than have it stand idle earning no income. Various local authorities have instigated lord able initiatives of bringing empty properties back into use and despite a huge amount of resources being poured into the process, they will bring back tens of properties over the schemes lifetime. Despite generous grants the numbers bare no relation to the EHA claims.

What is interesting that the EHA fail to mention the numbers of empty council and housing associations properties. Maybe as ever its easier to have a pop at landlords than highlight the inefficiencies of local government housing practice.

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