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Prioritising Empty Homes in your Authority to drive more revenue

empty property network articleHelen Williams, Chief Executive of the Empty Homes Agency noted at the Empty Homes Conference held earlier this year that there are around 200,000 properties in England that have been empty for six months or longer and getting them back into use should be a key priority for each Authority.

Why Empty Homes should be a priority
Why? Firstly it will help ease some of the pressures around social housing, secondly it helps focus Councils on re-generation by reducing the number of run down properties in a neighbourhood and thirdly it generates more revenue for Authorities through taxation and the New Homes Bonus (NHB).

Following legislation passed in April 2013, Authorities were given discretion to set their own levels of discount on council tax charged on empty properties. This included being able to charge an Empty Homes Premium of 50% on top of the full council tax for a property and can be applied to homes lying unoccupied for over 2 years to encourage owners to get these properties back in use more quickly.

Challenges
This approach does not come without its challenges particularly as the number of unoccupied homes in the UK changes on a daily basis as people’s circumstances change. At a local level Councils should be focussed on putting systems in place to identify at any point in time how many empty properties they have in their Authority, how long they have been empty for and whether any exemptions apply. This should also be done in conjunction with tracking new developments to identify the earliest point at which new properties can become taxable. The money collected in this area can then be re-invested in regeneration projects such as funding for maintenance and repairs to bring other properties back into use.

Preston and Lancaster Shared Service case study
Preston and Lancaster Shared Service (PALSS) are currently leading the way in this area having commissioned a bespoke Property Inspection Module to be designed and built for them so that they can proactively track all properties in their Authority. This has already led to an additional £330,000 of tax revenue being invoiced for 2016/17, thanks to earlier detection of new property developments being at a stage where they can become taxable.

The technology they use, developed by Destin Solutions, not only tracks new developments but enables them to track all existing properties across Preston and Lancaster. It identifies whether they are listed as occupied or not, over what period of time, what exemptions are currently in place for a specific property, whether any Council debt is associated with a property and when the property was last visited or inspected. This ensures they have up to date information about the current status of all their properties with accurate details of how many properties are lying empty, which can be shared across their Revenues department and with their Empty Homes Officers.

The importance of data
The more detailed information an Authority has about their property base, the more informed their decisions become. For example, by reviewing all the exemptions listed against properties, by type of exemption, a Council can see in a single view how many properties are not currently paying tax because they are undergoing repairs. If you were to then cross reference this information with how long the exemption has been in place, for example over 6 months, this may indicate a need for Inspectors or Officers to revisit the property to identify whether repairs are complete so the exemption can be lifted and the property put back into use.

It’s not just about data-crunching and management reporting however, a good Property Inspection Module should incorporate workflow elements so that outcomes of inspections and visits can be captured and stored centrally with various alerts and triggers sent to other relevant departments where follow up is required. It should also act as an audit trail helping to support Property Inspectors and Empty Homes Officers by providing evidence of the actions they have taken in their attempts to get an empty property back into use.

Empty Property Review service
PALSS also commissioned an Empty Property Review service, providing a list of their current empty properties to Equifax, who carried out over 30 different checks to help identify the likelihood of that property now being in use. Typical checks looked at whether there was any credit card activity associated with an address or whether any bank accounts had recently been opened listing that address. This information was then passed back into the PALSS Property Inspection Module, so they could decide for themselves on next best action and which properties required a visit to confirm whether the property was still in fact empty.

This is a proactive approach to tackling the empty homes issue and the costs associated with implementing the technology tend to be covered by the earlier detection of inhabited properties where tax is not being paid, and the subsequent new homes bonus gained from this. Additional revenues are also generated through quicker identification of the stage at which new developments come into taxation, ensuring investment in this type of technology is commercially viable.

David Gibbens, Policy Lead at the Empty Homes Network believes that from the empty homes practitioner point of view, the input from Destin Solutions is really exciting and went on to comment “there are many good examples of Empty Homes Officers working very closely with council tax departments, effectively operating as Visiting Officers. Their work generates significant income via the New Homes Bonus (NHB). But the extra information coming from Destin’s solutions can really strengthen those internal partnerships.  Some of the New Homes Bonus earned can be fed back into supporting proper empty homes initiative that produce yet more NHB. Some Empty Homes Officer posts are funded from the NHB they earn: these new approaches will make the sums even more compelling.”

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