Select Committee on Transport, Local Government and the Regions Memoranda


Memorandum by Newham (EMP 45)

EMPTY HOMES

  I write with reference to the above inquiry. I hope I am not too late to submit evidence. We have also submitted some information via the Local Government Association.

  In Newham, empty properties are the responsibility of a joint initiative between the Housing Department and Environmental Health.

  Because of our role as educators and enforcers of legislation, and our historic role in trying to secure the improvement of privately owned and rented property, Environmental Health are well placed to deal with these issues.

  Being a London Borough, we are in a "high demand" housing area. We do not use renovation grants as a strategy for bringing vacant properties back into use, because, as a Council, we use grants as a strategy for area renewal. In the past, individual renovation grant aid did not have any significant impact on improving the "image" of an area and our Members felt that an area approach gave "added value" when it came to regeneration.

  In Newham, we have what we believe to be the largest compulsory purchase programme in the entire South of England (and possibly England). We have over 65 cases where the Council has exhausted informal means and has resolved through a meeting of full Council to take compulsory purchase (CPO) action. Whilst some of this activity is driven by the Single Regeneration Budget (SRB) 5 programme around Forest Gate, the majority of properties are outside this boundary. We also have a queue of some 75 or so properties where we plan to take compulsory purchase action and are only holding back because our Legal Services Department cannot process too many at a time. We have traced vacant property owners to countries as far away as Australia, Dominica and South Africa.

Why are homes left empty?

  There are many complex reasons including family breakdown/tragedies; disrepair and the belief that the home is worthless; investment—hoping values will increase; negative equity; people "in care" or undergoing prolonged treatment in hospital; problems with legal title and probate.

  Part of our role, as Local Authority Officers is to try to identify the reason and encourage the resolutions of these barriers by working co-operatively with owners of vacant properties.

Consequences of Empty Properties

    —  Increased dereliction, and an air of neglect and decay in an area.

    —  Eyesore properties.

    —  Vandalism, arson attacks, increased rubbish dumping and increased rodent complaints.

    —  Increased crime. Overgrown gardens act as a "shield" for street attacks, usually against women, empties are used for rapes and as drug houses.

    —  Both business users and residential investors are deterred from investing in the vicinity.

    —  Lowers property prices in the area.

    —  Loss of rental income for property owners.

    —  Increased deterioration in the fabric of a property when vacant.

    —  Lowers levels of sustainability.

    —  More people on the Council Housing Waiting list/in "bed and breakfast" accommodation.

    —  Hinders "area regeneration".

Benefits of an Empty Property Strategy

    —  Reduces all of the above-mentioned negatives (see consequences above).

    —  Reduces the need to build new dwellings on "greenfield" sites.

    —  Bringing back into use flats over shops cuts crime rates—enables this accommodation to be rented by students and other single people, thereby preserving other, more suitable accommodation elsewhere for families.

    —  Improves the general repair of the nation's housing stock.

    —  Encourages energy efficient measures to be undertaken—and also increases the number of energy surveys conducted by Local Authorities as required by the Home Energy Conservation Act.

    —  Enables Councils to obtain old debts—eg unpaid Council Tax; works in default either by the sale of the vacant property or by the Council successfully identifying and tracing owners. In one case, Newham recovered in excess of £35,000 on one property alone.

    —  Reduces complaints to the Council/additional calls on Council Services from neighbours adversely affected by the condition of an empty home.

    —  Brings life back into Town Centres.

COUNCIL TAX

    —  We believe that people keeping properties vacant, without any just cause, should not be encouraged by paying Council Tax at 50 per cent of the "usual" rate after a six month period. Consideration should be given to penalising owners of vacant properties either by charging them at a rate of 200 per cent after say 12 months or, at the very least, ensuring they pay at the full (100 per cent) rate after the first six months.

  Property owners who are "in care", hospitalised for prolonged periods of time, in prison etc should be dealt with by exemption from this general requirement, although this perhaps ought to be limited to, say, the first five years. After that time, it should be presumed that the person in care is likely to stay there in perpetuity and should be selling the property on/letting it out.

REVISION OF COMPULSORY PURCHASE POWERS

  Newham is aware of the current consideration being given to compulsory purchase powers. We would wish to make the following observations:—

    —  As a general principal, to deprive a person of their own property is a serious matter and it is right that Public Authorities have constraints on this action. It is felt that the current safeguards are more than adequate to protect the interests of owners of vacant properties.

    —  The current requirement for a Local Authority to prove CPO action is a "last resort" is very difficult and onerous to prove in law. Newham has failed to prove to the Secretary of State that after a site being left vacant and derelict for some seven years, CPO action was necessary. With planning permissions lasting a maximum period of five years, we can foresee occasions where a recalcitrant owner can keep renewing planning applications and never developing the property/site.

    —  Circular guidance should encourage Councils to consider vacant sites and building currently in use for commercial purposes (but with the potential to convert into residential) to be subject to CPO action. It seems as though a number of Councils are taking a "blinkered" view of the term "vacant properties".

    —  The costs of financing CPO action are considerable for a Local Authority. All of the preparatory works, the costs of representation and for the actual Public Local Inquiry all fall to the Council, even when the objections can be spurious ones from third parties.

    —  Onward disposal of a property that is vacant and that has been compulsorily purchased is problematic and risky for a Local Authority. The Notice to Treat procedure is not considered appropriate for use with vacant properties because we cannot dispose of a property until compensation has been agreed. This may involve Lands Tribunal and effectively means that CPO property would have to be retained vacant for up to two years where there was a dispute between the owner and Local Authority as to the property value. However, with the General Vesting Declaration procedure that Newham uses, with the aim of getting the property sold on quickly (so that it can be refurbished and brought back into use speedily), there is uncertainty from the Local Authority's point of view in that we could sell on for one price and then find that the negotiated value (afterwards agreed with the owner) turns out to be greater. Would it be possible to consider suggesting that a valuation from the District Valuer would be acceptable for onward disposal, with the protection that an owner could appeal within 21 days to a County Court?

    —  Some criminal elements are abusing the information that Councils have to publish by law in local newspapers announcing that they intend taking CPO action. These elements break into properties and carry out rather poor refurbishment with a view to obtaining "adverse possession" of the properties after a period of 12 years. They use the information the Council has been able to determine about ownership of the property, and which it is legally required to declare, as a means of concocting a story to try to prove that they are the owners. Some are renting these properties out to innocent individuals at normal market rents through newspapers such as "Loot". This seems to be happening in around 15 per cent of Newham's CPO cases. We know of instances where private firms of solicitors acting for clients in probate cases are experiencing similar difficulties.

    —  Where owners cannot be traced/are dead and either has disinterested next of kin or no next of kin at all, and a property is clearly squatted, Local Authorities should have power to compulsory purchase. This is because of the lack of sustainability and legislative controls on squatters.

    —  The Data Protection Act sometimes frustrates the process of Council's trying to trace owners. For example, gas, electricity, and water companies often have information on ownership and it may be in everyone's best interest to share this information. The Act currently precludes them from doing this. Additionally, individual Council Departments cannot share information on vacant properties. Council Tax information cannot be obtained by Housing or Environmental Health Departments because that information is privileged for Council Tax purposes both under Data Protection and Council Tax legislation.

Should a Statutory Duty be placed on Councils to write an Empty Property Strategy?

  Some Councils are already taking their responsibilities for dealing with vacant properties seriously whilst others are not. I have doubts as to whether making it a "statutory duty" per se would make any significant difference.

  It is interesting that in Newham we find approximately 10 per cent of the properties we deal with do not get brought back into use until the Council formally resolves to take CPO action. Around 4 to 5 per cent of the total number of vacants gets successfully compulsorily purchased.

  Judging by the number (lack of) CPOs being undertaken in the rest of London, either Newham is not being effective in using informal means to bring vacants back into use or other Councils are not pursuing those intransigent vacants all the way to the ultimate conclusion!

Government Departments properties

  To be fair, other than for properties "blighted" for some 10 years whilst the A13 trunk road proposed improvements were being debated, Newham does not suffer too much from this problem.

  I do know, however, that elsewhere in the country this can be a serious problem, especially with Defence and other Armed Services Establishments.

  Some redundant hospital sites seem to take an inordinate time before being redeveloped.

  We are concerned that some companies "land bank" over a considerable number of years. Whilst short-term land banking has benefits, once this goes over one year, it can frustrate regeneration.

  In conclusion, I hope you can see that Newham's Environmental Health Department has considerable experience in dealing with long term vacant properties and compulsory purchase powers. We would be pleased to meet with LGA officers or present evidence to the Select Committee.

Nigel Ward

Lead Environmental Health Officer

Housing and Public Health Unit

September 2001


 
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