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Is Your Property Empty? Understanding the Implications of the Empty Homes Premium and Empty Dwelling Management Orders.

Owning property can be a substantial investment and a significant responsibility. But what happens when that property sits empty? Empty homes aren’t just lost opportunities; they can also bring financial penalties and legal complications. If you own a property that’s unoccupied, it’s essential to understand the implications of the Empty Homes Premium (EHP) and Empty Dwelling Management Orders (EDMOs).

Empty Homes Premium: A Financial Consideration

The Empty Homes Premium is a financial tool used by local councils in England to encourage property owners to bring empty properties back into use. Here’s what you need to know about it:

1. Increased Council Tax: If your property has been unoccupied and substantially unfurnished for over two years, it may be subject to the Empty Homes Premium. Local councils have the authority to charge this extra amount on top of the standard Council Tax. Depending on how long the property has been empty, this premium can range significantly. For instance, homes vacant for over two years might see up to a 100% increase, while those empty for more prolonged periods could face even higher charges.

2. Rising Costs Over Time: The longer your property remains empty, the higher your financial liability can become. This is designed to discourage property owners from leaving homes vacant and underused.

Empty Dwelling Management Orders: Legal Implications

Empty Dwelling Management Orders (EDMOs) are another tool councils can use to tackle the issue of empty homes, particularly when properties are left vacant without good reason:

1. Local Authority Intervention: EDMOs allow local authorities the right to take control of empty properties. If a property has been unoccupied for more than six months and is seen to be causing a nuisance or is a wasted resource in an area with high housing demand, the local authority can step in.

2. Property Management: Under an EDMO, the local authority doesn’t take ownership of the property but does take over its management. This can include carrying out necessary repairs, finding tenants and making sure the property is well-maintained.

3. Financial Impact and Control: Any rental income generated from the property under an EDMO is usually used to cover management expenses, repairs and potentially the costs associated with the EDMO process itself. As the property owner, you might have to cover any shortfalls.

Why It Matters

Leaving a property empty may seem like the easier option, but it comes with considerable financial and legal risks. From increased council tax bills to the potential loss of control over your property, the implications are significant.

Steps to Take

If you own an empty property, consider these steps to avoid the implications of the Empty Homes Premium and Empty Dwelling Management Orders:

1. Rent It Out: Leasing your property can provide a steady income stream and ensure it remains occupied.
2. Sell the Property: If managing an empty property isn’t feasible, selling might be the best financial decision.
3. Renovate: Sometimes properties remain empty due to their condition. Investing in repairs and renovations can make the property more appealing to potential renters or buyers.
4. Seek Advice: Contact your local council for specific advice and assistance programs they may offer for bringing empty properties back into use.

Conclusion

Owning an empty property may seem inconsequential at first glance, but ignoring its status can lead to significant financial penalties and legal complexities. Understanding the implications of the Empty Homes Premium and Empty Dwelling Management Orders is crucial for any property owner. By taking proactive steps to address the status of your property, you can avoid these complications and turn what could be a liability into a valuable asset.

Don’t let an empty property cost you more than it should.

This blog was prepared by Guy Wilton on the 15th January 2025 and is correct at the time of going to press. Guy lives on The Wirral and works in Liverpool. Guy and his team will be managing all work locally and have wide experience of acting for the firm’s clients, their family and their businesses. Guy’s experience as a lawyer started in the Northern and Welsh Circuits, including the Liverpool Courts, where he represented numerous clients in Civil proceedings after being called to the Bar, before opting to join Alexander JLO in 2017 and qualifying as a solicitor in 2024.

Guy’s profile on the independent Review Solicitor website can be viewed here.