Public purse losing out on £1.2m from 'empty homes'
Thursday, 4 September 2008
LOCAL public services could be boosted by almost £1.2 million if a move by the Northern Ireland Executive to rate empty homes goes ahead.
Councils have recently responded to a consultation into the rating of empty homes by the Department of Finance and Personnel, which says the move will enable additional revenue to be raised for local public services such as health, education and transport.
In its response, Armagh Council has said it broadly supports the proposal, which could see its rate income increase by £597,491.
But members have warned that some owners may deliberately make houses unfit for habitation to avoid paying.
According to the consultation briefing, the Armagh Council area has 1,979 vacant properties - 9.13 per cent of all properties - with an empty property rate liability of £1,194,279.
The Armagh Council domestic rate of 0.3393 in 2008/09, with an average capital value of £88,982, would indicate a maximum potential increase in rate income to the council of £597,491. If only 50 per cent was collectable - assuming not all empty homes are capable of occupation - it would mean extra income of £300,000 a year.
But council chief executive John Briggs said while members had welcomed the proposal, some concerns had been raised.
He said: "The payment of rates may trigger the sale of some properties and the concern was raised that these additional properties on the market - at a time of uncertainty in the housing sector - may have an adverse effect on confidence in the economy.
“The construction sector of the economy is currently in recession and the release of additional properties onto the market may further reduce the demand for new homes.
“The council welcomes the effect that this will have on making unfit properties habitable, but considers that some assistance should be made to these home owners".
Mr Briggs said concerns had been raised that unfit homes may be released to the private rented sector, and there should be adequate safeguards put in place for tenants, and that some owners may make houses unfit for habitation to avoid rates. Some controls would need to be put in place should the property come back onto the market.
Armagh Council has also warned that the Northern Ireland Housing Executive may face increased financial costs and this may affect its housing provision.
An enabling power has been provided in recent rating legislation allowing the Assembly to introduce the rating of empty homes should it wish to do so.
It has been estimated that seven per cent of all dwellings in Northern Ireland are empty - unlived in and unfurnished - representing almost £31 million in rates liability.
