The costs of owning an empty, vacant property in the United Kingdom can build up over time ranging from insurance and maintenance costs to council taxes.
However, many property owners and landlords are unaware of such costs and expenses.
But today is your lucky day!
This guide outlines the different costs associated with holding an empty property and highlights a few of its many disadvantages over time.
How many unoccupied homes are there in the United Kingdom?
According to a government study issued in September 2020, there were 479,000 houses recorded as empty for council tax purposes, with 69,000 paying a council tax premium.
Furthermore, Action on Empty Homes defines 268,385 of the 479,000 vacant dwellings as long-term empty properties, having been vacant for six months or more, and says this figure is rising in most local authority areas.
Paying council tax on empty homes
Council tax is one of the highest costs of owning a vacant property, particularly if the property has been empty for a long time.
Amid a national shortage of homes, the council tax bill is an approach by local authorities to bring empty homes back into use.
Furthermore, recent regulations mean that councils can charge astronomic council tax on vacant homes. Councils can charge a 200% premium on properties left vacant for five years or more. That represents a fee three times the usual rate.
Also, vacant properties for ten years or more incur charges up to a 300% premium. That’s four times the usual rate.
These charges could apply to you even if you’ve only had the property for a few years, but the property was left unoccupied by the previous owner for five years or more.
Yet, council tax isn’t the only cost of concern if you own an empty, vacant property. Below are some of the other problematic charges.
Bills and maintenance costs
An unoccupied property will accumulate household expenses such as water and gas, even on a standing charge, resulting in avoidable outgoings.
Furthermore, a property that once had a great appeal can deteriorate over time. If not checked on regularly, it could be the victim of a costly disaster like flooding or water damage.
Several property owners assume that they are pretty much covered once they take out home insurance.
Unfortunately, your property’s insurance may be void if it is vacant for a long time. So, if you have a standard policy and file a claim when the property is vacant, the insurer may decline your claim.
Most insurers consider a house uninhabited if empty for 30 consecutive days; however, others may cover a property if empty for up to 60 consecutive days.
Furthermore, insurers typically regard unoccupied properties as higher risk, resulting in higher premiums than standard house insurance.
That’s because issues like a leaky pipe may cause more significant damage if they go unnoticed for a couple of weeks. There is also a considerable risk of burglary, theft, or vandalism when a property is unoccupied for extended periods.
Cost of keeping property safe and secure
In addition to routine maintenance expenditures, there are emergency repairs to consider while holding a vacant property. Unfortunately, no single list or situation can adequately summarise this. However, there are several instances in which you may be required to bear emergency charges.
And one such situation is vandalism or burglary. Vacant properties are commonly victims of vandalism, theft, and flytipping. According to the Crime Prevention website, an estimated 60% of burglaries occur while a property is vacant, even if just for a brief period.
Furthermore, overgrown gardens are often the first sign of an unoccupied property, attracting these unwanted visitors. Making sure that the outdoor area is tidy at all times can help deter unwanted attention and limit additional costs.
Keeping and holding an empty property can cause emotional distress. This is especially true if you inherited a property in a city or county that is farther away from your current residence, which can often be the situation with the inheritance of unexpected property. The accompanying inconvenience means that selling the house as soon as possible would relieve the burden.
Furthermore, dealing with estate agents can contribute to emotional stress, as it might not be possible to be present always when needed.
Turn a liability into an opportunity
Several reasons may account for a property standing vacant. It could need repairs or have been inherited, and the new owner hasn’t decided what to do with it yet. Perhaps the owner relocated and hasn’t found a buyer for it.
Regardless of the reason(s), once factors like council tax and maintenance costs come into play, it’s easy to view something once considered an asset as a liability.
In such a scenario, selling the property becomes critical. However, with the recent COVID-19 cases and enforced lockdown restrictions, interest and inquiries could decline on properties up for let or sale, as physical viewings are prohibited. Yet there are other alternatives such as auctions.
There is heightened demand for properties of all types and conditions in the auctions industry, and they can still operate safely and efficiently online.
Landlords and property owners bothered about spiralling costs on their vacant properties could turn to property auctions to help improve their finances..
As several UK auctions have moved online in response to social distancing measures, property owners could soon release the funds from their expensive vacant property, hence, quickly turning them from a liability to a profit.
Alternatively, you can sell to a house buying company.
Our Professional Property Buyers
When it comes to selling your house quickly, our knowledgeable and experienced property buying team is ready to assist. We specialise in speedy property sales, as opposed to typical estate agents. Our quick sale offer is dependable and has been utilized by a large number of property owners in need of a rapid sale. So, if you want to get your house sold quickly, let our professionals handle your rapid house sale.
About Richard Mews
Richard has 31+ years of property experience, has been Chairman of several regeneration committees and has helped more than 600 homeowners and landlords get easy, stress-free personal solutions for selling their property. Richard’s goal is to give you unbiased help to receive a quick house sale, even if that means not working with him.