London Ghost Home Tax; empty homes have to pay an extra charge

London Owners of empty homes will have to pay an extra charge under council plans, as people in prime areas of London, such as Primrose Hill, complain that their neighbourhoods are becoming unaffordable ghost towns.

Residents say some wealthy investors have bought four or five homes in affluent areas of London, driving up prices and damaging the sense of community because most of the properties are left empty. They fear the number of unoccupied homes could see schools and independent businesses forced to close in 20 years.

Camden council, a Labour-run authority in north London, which covers Primrose Hill, wants to charge owners of homes that have been empty for more than two years double the normal council tax in a bid to return vacant properties to use.
The scheme has already had some impact, with owners of empty properties being charged 50 per cent extra, but the council has now suggested a further increase could bring back almost 200 homes to use. Since the council introduced a 50 per cent extra charge last year, the number of long term empty houses has fallen from 248 to 162.

Chancellor of the Exchequer for the Coalition government, has called for a clamp-down on ‘buy-to-leave’ investors with a 15% stamp duty on the purchase of any property over £500,000; this is a drastic reduction from the £2 million threshold originally set in 2012. This change is set to happen gradually, with a £7,000 fee for properties between £1 million and £2 million as the first step. An alternate approach has already been taken in Camden. The Labour Party councillors, who dominate the politics of the district, have opted to take advantage of the legislation allowing for a 150% council tax on empty properties. Since its adoption in 2012, Labour councilmen state that the number of abandoned properties has gone down by 35%.

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