Poll: Council revokes tax discounts on empty or second homes in Colchester
18:12 26 February 2013
OWNERS of empty properties in the Colchester area are to lose their community tax discounts in a bid to alleviate the housing shortage.
Colchester Borough Council is set to take advantage of new powers granted under the Local Government Finance Act 2012, which enables local authorities to reduce the levels of discounts currently granted to second homes and empty properties.
Under the new rules, due to come into force on April 1, there will be no discounts for empty properties in the borough. If a property stays empty for more than two years, owners will be charged community tax at the penal rate of 150%.
According to councillor Paul Smith, who is portfolio holder for business and resources, it is hoped the move will encourage owners to bring their empty homes back into use.
He said: “There is a severe problem with housing in Colchester and there are around 4,500 names on the housing needs register. We want more homes to be made available, so it makes no sense to incentivise people not to do that.
“If people know they will have to find an extra £1,200 a year, it may persuade them to make their property available for rent.”
Mr Smith said there are at least 1,000 empty homes that could be opened up in the borough - more than the number of new homes built in the area last year. He also said he believed the move might have the effect of lowering high rents for tenants on low wages.
He added: “If you are a landlord and your property starts to cost you, you are more likely to consider offering it at a lower rent just to get people in. Likewise, if tenants are in a spot of difficulty, a landlord might consider cutting the rent for a few months rather than risk having the property standing empty.”
But Mr Smith also acknowledged that the new regime could hit housing associations who will be charged if their properties are not inhabited.
However, deputy chief executive of Colne, a housing association in North Essex, said she welcomed the move if it made more homes available.
She said: “A home is one of the most basic of human needs and it is becoming harder and harder for many people to secure an affordable one. With the average house price in Colchester sitting at £202,811 - nearly 10 times the average regional income of £21,850, home ownership is unattainable for many families.
“As the number of households in this region is expected to grow by 27% by 2033, this already desperate housing situation in this area will only continue to get worse.