Major changes to crackdown on long-term empty homes fast approaching

Homeowners now have clarity

Starting from 1 April 2024, there will be stricter rules in place to double council tax on long-term empty properties. This is aimed at freeing up more existing housing stock. Instead of the current two years, the rules will now apply when a property has been empty for 12 months. Additionally, councils will have the power to introduce a tax premium on second homes in their area from next year, which will bring in more funds for public services or help keep overall council tax bills down. 

After a public consultation, the Department for Levelling Up has confirmed a few exceptions to ensure fairness for homeowners. These exceptions include uninhabitable properties undergoing extensive renovation, second homes with planning restrictions that cannot be used year-round, and homes inherited by grieving families for up to a year. 

Homeowners now have clarity on the changes and can plan accordingly, while councils can budget for increased funds to spend on public services. 

Simon Hoare, the minister for local government, stated that long-term empty properties are preventing local families and young people from accessing the housing market in their own community. As part of the government's long-term plan for housing, action is being taken to deliver more suitable homes in the right locations and give councils more authority to provide local people with the homes they need. 

These changes are part of the government's goal to deliver one million homes this Parliament, supported by a £10 billion investment, and will help unlock more of the homes needed in the country.

Stamp duty reform - at last!

The big news in property this month has been the Autumn Statement and the changes to how stamp duty is administered. It's great news for most people looking to buy or sell a property. Stamp duty used to be stepped so that, for example, if you went one pound above the cut-off mark of £250,000, you’d suddenly pay three per cent rather than one per cent — of the whole price, not just the money over the limit. That was totally unfair and ridiculous, and essentially used to mean there was a logjam of prices at these thresholds. Under the new system, announced by Chancellor George Osborne if you go over a band, you only pay the higher level of duty on the money over the limit.

Asking prices dip at end of 2014

Asking prices for residential properties in the UK suffered the largest monthly drop on record in December, as the market continued to cool, according to Rightmove.

The property website reported that 2014 has ended with the average asking price for a home in Britain falling by almost £9,000, leaving prices up 7 per cent during 2014.

But whilst a near £9,000 drop is the biggest ever reduction in the price of newly marketed property compared to the month before and a sign of a market continuing to cool, Miles Shipside (left), Rightmove Director and housing market analyst, pointed out that “a fall is not unexpected in December”.

He commented: “Though sellers are fewer in number at this time of year, those that do come to market are often keener to sell so price lower in a bid to stand out. The overall picture for the year is still one of a much recovered property market, with sellers and their estate agents confident enough to be putting property on the market at a higher price on average than a year ago.”

Despite the sharp fall in December, Rightmove project that asking prices for homes on sale in Britain are likely to rise by between 4 and 5 per cent next year, led by gains in the South East as the London ripple effect continues and stock shortages remain acute.

“In spite of generally positive market conditions, some of the measures designed to restrain and control buyer demand have also curtailed the supply side by damaging the desire and ability of homeowners to place their property up for sale,” added Shipside. “Elections also add a further element of uncertainty that may deter some from making a major financial decision to trade up or down, so the likelihood is that good quality property will be in short supply in higher-demand locations, leading to higher prices where buyers still remain ready, willing and able to proceed.”

With the average number of properties for sale per estate agency branch at an historical low for this time of year, “there is still some scope for price growth” according to Shipside, but he insists that “sellers and agents will have to work harder to achieve a sale next year”.

Rightmove’s findings are supported by the latest Home.co.uk Asking Price Index which also shows that asking prices fell in December in line with seasonal expectations.

The mix-adjusted average asking price for England and Wales rose 7.6% during 2014, according to the Home.co.uk Asking Price Index led by gains in London and the south of England.

Looking ahead, Home.co.uk forecast that 2015 will be a more consistent year for UK property prices than 2014.

Source: Property Market