Empty properties in Cornwall
There was an interesting article in the Observer yesterday about bringing empty homes back into use, in particular in Cornwall. With the current shortage of properties, it is a scandal that there are some 920,000 properties empty nationwide.
Given the estimated £10,000 investment per property to bring it back into use compared to £90,000 subsidy to built it from scratch, it makes very good sense. For example on those figures, the £2 million set aside by Cornwall to get some of its 3,597 properties back into use, would give 200 properties as opposed to about 22.
However Cornwall seems to be doing better than that, as the article reports 131 having brought back into use so far with a further 350 by the end of 2013. Well done Cornwall! Mind you, still some way to go though.
Other areas taking action
However, Cornwall is not the only county taking action. According to the article Kent and Bristol are making respectable efforts to deal with the problem.
I hope the efforts succeed, and that compulsory purchase orders WILL be made against recalcitrant property owners.
Some questions
Incidentially, the article only mentions compulsory purchase orders and not the Empty Dwelling Management Orders which came into force a few years ago. Are these not being used?
One problem mentioned by the article is MOD military bases which have been shut and the houses left to rot. This seems on the face of it, unacceptable. Can nothing be done about them?
It also seems unhelpful to say the least, that mortgage companies are unwilling to lend on homes which have been empty for more than six months.
It would be great to learn what other local authorities are doing about empty properties, and how successful they have been.
Tessa, I have spent 20 years trying to encourage local authorities to do CPO on empty homes, issues such as, lack of legal knowledge, too expensive and “we don’t interfere in the private sector”, have been quoted back at me. I hope the Cornwall example is copied.
If done properly,CPO is one of the most efficient ways to tackle long term, derelict empty homes.
EDMO’s are good for the vacant s that are not derelict, as you need to be able to recoup your costs in the 7 years lease period that you require. However, EDMO at the moment, are fiddly and time consuming, and not very effective. Hopefully in time, the process can be refined so that it becomes a better tool.
The MOD has long been castigated by us and Empty Homes the national charity, and to be fair, they have sold off hundreds of homes. But they need to be taken to task at Central Government level, which Empty Homes does.
It is good to see a local authority setting aside monies for this, many more are claiming poverty, which is why I have helped to set up a private compnay which is prepared to use its resources to refurbish property for owners in return for a 5-7 years lease, in which we manage and maintain the property giving the owner a guaranteed rent and no mangement fees. We have started in the East Midlands and hope to roll out across the country in 2012.
The private sector needs to roll its sleeves up and help to tackle the problem of empty homes, its going to get worse!.
Thanks for your comment Paul. Best of luck with your company, we really need to get these empty properties back into use
Paul the council I work for are just expanding out into relationships with the private sector, I would be very intrested to find out more about how you work. Do you have a website?
We have quite a proactive EDMO guy as well which is good (notice I say EDMO guy, not team though)
I read the Observer article today and was shocked at the figure of 920,000 empty homes. I mentioned this to one of our EHOs and he was a bit cautious about it, citing things like holiday homes that get thrown in the mix too but even at less than half that figure it could seriously dent the crisis and, even with CPOs I would imagine it is cheaper than new build and wouldnt create such havoc with planning arguments
At the end of your article, you state that mortgage companies are unwilling to lend on homes which have been empty for more than 6 months.
There is one main issue here: it is becoming a nightmare for letting agents. The above fact has led to many property owners who want to sell their property (which is empty – mainly it is a property which they have inherited) cannot sell in the present property crisis (and do not wish their property to be empty for more that six months, otherwise with the mortgage problem it becomes less attractive to purchasers because they are less likely to get a mortgage), so the next best thing is to bung in a tenant. They now become accidental landlords, who mostly do not have a clue about the responsibilities of a landlord, and have a completely different view about a tenant and tenanted properties. The more people who are forces to do this, the bigger the nightmare for letting agents.
I spoke to Cornwall Council about this yesterday. I was informed that the ability to offer loans is in their policy but they do not have the funds to provide the service.
Basically, don’t get your hopes up. If anyone hears anything different please let me know.
I don’t think every landlord with an empty property is recalcitrant. A good friend of mine owns a property that has been empty for over 3 years and a compulsory purchase order would actually be an ideal solution for him to relieve him of the burden of the property.
He bought the property for cash, intending to re-mortgage to fund the substnatial refurbishment that was required. Unfortunately, he got caught out by the credit crunch and was unable to re-mortgage and has insufficient other funds to pay for the refubishment. He has twice approached the council for help only to be told they do not have a budget for this type of thing.
Funding is definately a major fly in the ointment. I am no expert on this area but I know there is money available that council’s can bid for but the government very tightly controls the criteria for qualification.
I think we have around £700,000 that has been given to us but I heard last week that a neighbouring borough got £13 million. Mind you they probably had to take Liam Fox on holiday to get it :)