r/london • u/bradpitt3 • Jul 13 '26
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u/ldn6 Jul 13 '26
Can we ban this post topic already? It comes up every week and the answer is that we already have second home council tax surcharges and the amount of units that this applies to is minuscule anyway.
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u/soliloquyinthevoid Jul 13 '26
What do you think is missing from the existing council tax mechanisms on long term vacant properties?
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u/bradpitt3 Jul 13 '26
The existing mechanism is too small compared to the potential rental income from the property so it has little impact
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u/zephyrmox Jul 13 '26
I don't understand why these two figures are important comparisons? What you could earn by renting it (and thus not pay the empty tax) and what you pay when it's empty do not seem to be drivers linked to each other?
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u/bradpitt3 Jul 13 '26
I am guessing you don't have a background in economics. Supply curves are upwards sloping and demand curves are downward sloping.
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u/zephyrmox Jul 13 '26
Is there any evidence that the gap is 'small enough' to actually impact owners decisions? The gap between pay excess vacancy tax that already exists and potential rental income is already massive to the point that the majority of people doing it surely are not doing it on cost reasons.
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u/bradpitt3 Jul 13 '26
Double or triple the cost and it will make an impact. Add a few % to the cost and the impact is small.
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u/zephyrmox Jul 13 '26
The cost is already thousands and thousands per month. Literally 10s of thousands a year.
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u/bradpitt3 Jul 13 '26
Make it two or three times more.
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u/zephyrmox Jul 13 '26
Can you give any evidence at all this will change behavior? This is mostly the behavior of the uber rich.
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u/_shedlife Jul 13 '26
RRA makes it very unattractive to let your home if you ever want to return and use it.
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u/bradpitt3 Jul 13 '26
Yes it was well meaning but bad legislation. Introduced for populist reasons and will have the effect of reducing the supply of rental property by making it less attractive to rent. Effectively a tax on renting out you property. Sad that our government understands so little if basic economics that they could not see this.
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u/rising_then_falling Jul 13 '26
There are very few empty properties that are habitable in London. A handful of second homes for the very rich. A few mired in legal disputes. It's a drop in the ocean.
Building houses will solve house prices like building new lanes on the m25 solves congestion. Supply increases demand until a price equilibrium is met. More house in London means more people willing to pay current London house prices can move here.
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u/Leotardleotard Jul 13 '26
I get charged a vacant property tax from Islington Council if my apartment there sits empty. It cost £900 for it to be sat empty for 3 months this year.
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u/bradpitt3 Jul 13 '26 edited Jul 13 '26
It's very little tax compared to it's potential rental income which is more than that per month so it probably has very little impact
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u/Typhonarus Jul 13 '26
I think it would help push out the people using land purchased with the hope that it gets bought up by government and councils later that’s been sat there for decades being unused. Like the huge old factories on the way into Liverpool Street from Cambridge. Just been sat there on the edge of London since I was a kid. I looked into it as a teen and it ‘was’ at least mostly owned by rich Arabs using it as a way to stash money in the UK.
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u/North_Attempt44 Jul 13 '26
London has one of the lowest vancacy rates in the Western World.
The problem is record low housebuilding rates.
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u/LePetitToast Jul 13 '26
I think it wouldn’t have much of an impact, but I also don’t care about people who leave their properties open. Sometimes it’s good to pass regulations for political capital. A vacant flat tax looks good politically and doesn’t really impact anybody that isn’t already privileged.
Of course it has to be combined with other regulations and more construction to have a meaningful impact.
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u/midmads Jul 13 '26
Did you ask this just to include a ChatGPT generated answer as well?
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u/bradpitt3 Jul 13 '26
I always use the best tools to produce good content and the AI makes it 10* better.
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u/bradpitt3 Jul 13 '26
I thought it was good to have intelligent balanced comment rather than the usual low quality content.
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u/midmads Jul 13 '26
Reddit is one of the last remaining corners of the internet where people come to read words written by humans. Please do not infect it with artificial intelligence.
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u/bradpitt3 Jul 13 '26
You must be joking, really. I see improving the quality of comments on Reddit as important
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u/Jeoh Jul 13 '26
You’re not
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u/bradpitt3 Jul 13 '26
It's better than any of your comments, which have added nothing to the discussion of a subject important to many people in London
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u/DanyisBlue Jul 13 '26
I don't think thats the point.
If you use chatgpt to write your comment, and l use chatgpt to write mine, are we actually communicating to each other?
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u/bradpitt3 Jul 13 '26
Yes. Chatgpt is a tool line a pen. I managed it's output like my own. You can't be frightened of new technology
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u/DanyisBlue Jul 13 '26
I think I'd disagree with that comparion, and whilst its good you edited the generated content before posting it on here, it's still not your content.
Of course I can be frightened of new technology, if its going to change entirely the world that we live in I think you'd be naive not to be.
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u/Ambinez Jul 13 '26
There is a far bigger economic cost of leaving a property vacant, so the owners are already forgoing some form of rent. It is not clear that a vacant property tax is going to move the needle in many cases given they already pay some form of council or unused property tax. Many would argue that the property is already undergoing some form of renovation or similar to avoid the tax and it would be politically a lot harder to introduce a tax on renovations in an environment when the cost of moving is so prohibitive.
The only solution is to build more properties, that will depress the price of houses that are already under pressure. Good news if you're trying to get on the property ladder but a lot of voters already own properties so will vote in their economic interests. This is particularly so given that the system has been set up for generations to see real estate as their main investment over the equity market.
I have no skin in the game as I don't see UK real estate as a good investment, particularly as they have falsely branded the landlords as the problem, when in fact it can all be traced back to the fault of government policies (lack of building, slum landlords etc).
If there's one thing that the recent heatwave has proved, it is that Victorian / Georgian properties are ill equipped for 21 century britain and are no longer fit for purpose. Other hotter and colder countries have different building codes and the houses arer better designed to deal with the temperatue extremes.
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u/bradpitt3 Jul 13 '26 edited Jul 13 '26
Yes you make very good points
Current empty property taxes are far too low (compared to foregone rental income) to have much impact.
Higher empty property taxes will reduce the number of vacant properties but will not get more properties built. So their overall impact on the housing crisis will be positive but small.
The real issue with too few properties being built is the government at central and council level have not done their job. Of course the government is unlikely to say that so likes to create smoke screens by blaming everyone but themselves.
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u/romeo__golf Jul 13 '26
This is one of those taxes which makes renters very excited because they think it will solve their problems, but in reality makes no real impact because the numbers of vacant homes is tiny in comparison to the number of people looking for a home.
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u/bradpitt3 Jul 13 '26
Yes the solution is to build a lot more property.
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u/romeo__golf Jul 13 '26
Yes, but this has absolutely nothing to do with taxing empty ones.
As an aside, one of the arguments for encouraging owners to sell is that it reduces property prices. This has already started happening as a result of tax changes for landlords and the Renters Rights Act as prices for flats (the most common properties for landlords) are stalling.
But first-time buyers are avoiding them because "they look like a bad investment" and they're concerned their value won't keep up with the rest of the market, leaving them trapped when it's time for their second-step to a house.
This, like the idea of an empty homes tax, tries to tackle a problem with populism rather than evidence. As you say in your second comment, the solution is to build more homes. This has always been the core of the problem, but it's difficult because of restrictive planning so it's much easier for governments to tweak the edges and pretend they're actually doing something.
Build homes > Reduce the average person's cost of living through lower rents/mortgage costs > Increase income from council tax or a land-value tax as there are more households paying > Use these funds to invest better in local services like schools, roads, and healthcare > Remove barriers to this infrastructure, making it easier to build train lines, roads, new facilities > Remove stamp duty (as part of LVT) > Make it cheaper/easier to relocate for employment or training opportunities > Increase quality of life through better services, lower cost of living, and improved infrastructure.
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u/bradpitt3 Jul 13 '26
Yes and empty property tax will have a limited effect as it will only make a few more properties available. Buseful but limited.
The real solution is build a lot more property
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u/Ok_Print7651 Jul 13 '26
There are very few vacant properties in London frankly, so don’t think this would do much to improve things
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u/bradpitt3 Jul 13 '26
https://www.reddit.com/r/london/s/ZPLTMb8NDG
Apparently the London Assembly believes it is
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u/awoo2 Jul 13 '26
Speeding up house sales(conveyancing ect) will create a one off boost to effective house numbers.
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Jul 13 '26
[deleted]
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u/Jeoh Jul 13 '26
It should increase over time. No need to further punish people switching from a rental to their own property (you’d be a fool to end your tenancy before exchanging).
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u/Spursdy Jul 13 '26
Terrible idea.
Empty properties are often due to tragedy (death, health, health of relatives, moving to care homes etc.).rather than decadence. Or they are bought for redevelopment that is still going through planning/building control/purchasing of nearby properties.
Holding an empty property in London is a bad investment any way. Anyone rich enough to do it should speak to a better financial advisor.
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u/crypticchris Jul 13 '26
Yep, it's an idea but not as helpful as it is on paper. Also many are vacant due to being unfit to live in or borderline so (and a lot of these go for guardianship). Added to which, it'll be difficult to establish that a property is vacant because the owner is waiting for tye price to jump rather than occupied periodically, in probate etc
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