Www.no-use-empty.org Making the Best Use of Our Empty Homes by Steve Grimshaw Regeneration Project Manager

www.no-use-empty.org

Making the Best Use of Our Empty Homes

bySteve Grimshaw

Regeneration Project Manager


Empty Homes

Empty properties constitute a wasted resource that could provide homes as well as reduce the pressure for new housing growth.

They also often have a negative impact on local neighbourhoods by their visual appearance, and a tendency to attract graffiti, vandalism, squatting and antisocial behaviour and are a disincentive to investment

There are 23,331 empty properties in Kent & Medway, 8,500 long term empties.

Why Deal With Them?


What we set out to achieve• No Use Empty (NUE) Launched 2005 to improve

the physical environment in four coastal districts of Kent - Dover, Shepway, Swale and Thanet by bringing empty properties back into use.

• NUE extended County wide – 2009

THREE APPROACHES ADOPTED

• Interest free loans (loans to sell / rent)

• Partnership fund (works in default and CPOs)

• Direct Purchase


Loan Scheme• Kent County Council and 9 LAs – interest free loans

• Maidstone & Ashford due to join loan scheme (not Canterbury / Medway)

• Loans - £25,000 per unit, maximum of £175,000 per applicant.

• Properties must be sold or let on completion (decent homes standard)

• Loan period (development 2 years, let 3 years)

• Do not offer loans where property will be occupied by applicant (FSA)

• Secured as a financial charge against property

• Maximum LTV 90%, independent valuation (charged to applicant)

• 100% of the funding provided upfront (staged, if maximum loan)

• Properties expected to meet the decent homes standard on completion


Loan Scheme – Investment vs Leverage

Loan SchemeThanet DC

Dover DC

Shepway BC

Dartford BC

Sevenoaks

Swale BC

Tonbridge & Malling BC

Gravesham

TunbridgeWells BC

Funding By No. of Units

% of Units

Value NUEI Loan £

Leverage Total Investment

% of Loan

% of Leverage

% of Total

Project

Individuals (<3 units)

93 29% £2,238,840 £4,905,575 £7,1441,415 38% 43% 41%

Developers (> 3 units)

229 71% £3,673,000 £6,493,991 £10,166,991 62% 57% 59%

Total 322 100% £5,911,840 £11,399,566 £17,311,406 100% 100% 100%


Loan Scheme – Statistics• Average renovation cost per unit = £43,526 (often very worst properties)

• KCC average investment per unit £17,987

• Average cost per unit £2,866 (interest and management cost) – Loan Scheme

• Repayment to date £ 1.7 Million (low default rate x 2 loans)

• 11% Loan to Sell (2 years) & 89% Loan to Let (3 years)

• Only 20% of application forms returned & 88% of them approved

• For each £1 spent on interest and administration, this translates to £20.63 being spent in local economy (labour & materials) – created/sustained over 330 jobs


Old School House (Loan to Sell)


Warehouse (Loan to Rent)

Derelict Warehouse (Dover)• NUE Loan £175,000• Developers Contribution

£161,000• Total development £336,000

• 6 x 2 bed apartments • 2 x loft apartments• high spec - private

courtyard, allocated parking, security gates and video entry system


NUE & Affordable Housing Loan SchemeNUE Scheme has been be extended to 2016/17

• Total Capital Fund - £12 Million over 5 Years• Target of a minimum 200 empty homes back into use per year

NUE Affordable Homes Project 2012-2015

• £1M Capital Funds secured December 2011 (KCC Regeneration Fund) • £790,000 confirmed by Homes & Community Agency (HCA) • Looking to work with Amicus or other interested RSLs• Total £1.79 Million

Proposed Loan Terms• Maximum loan £25k per unit, maximum loan per applicant £250,000• Interest free loans up to 3 years (loans to let)• Must be let through Registered Provider (RSL / HA) – 5 year lease• Must meet Decent Homes Standard


Partnership Scheme

Provide funding to facilitate:• Compulsory Purchase Orders• Works in Default (Building Act, Housing Act, Town and Country Planning Act) • Empty Dwelling Management Orders• Direct Purchase (CPO or otherwise)

Supported by Consultant :• A floating resource to the district councils (virtual team)

• Identifying the most appropriate course of action for most difficult properties

• Providing professional & technical guidance on implementing course of action

• Working with EPO to encourage other departments engage actively


CPOESP

CPOESP

Works in Defaultor

Prosecution

Works in Defaultor

Prosecution

Enforcement (Notices Served on Owner)

Enforcement (Notices Served on Owner)

Threat of EnforcementThreat of Enforcement

Financial Assistance / Other Assistance(Loans, grants, home improvement agency, private

sector leasing)

Financial Assistance / Other Assistance(Loans, grants, home improvement agency, private

sector leasing)

Advice and Guidance(Development advice, tax and vat, reduced fees to sell via

auctioneer, guidance on extent of works, guidance on planning, raising finance)

Advice and Guidance(Development advice, tax and vat, reduced fees to sell via

auctioneer, guidance on extent of works, guidance on planning, raising finance)

Compulsory Purchase Orders, Enforced Sales Procedure or Empty Dwelling Management Order

Prosecution for non compliance of Notice or undertaking the works in default and using the County Court or Enforced Sales Procedure to recover costs

Statutory Notices under a range of legislation. Owner has right of appeal.

After exhausting of voluntary assistance, threat of appropriate enforcement action is raised with owner

Advice & Guidance58%

Grants 6% &

Interest Free Loans 18%

Threat of or Actual Enforcement 11%

CPO, EDMO & Enforced Sales 3%

Other (Auctioneer, sale of LA

land, PSL) 7%

No Use Empty Initiative: Achievements by Approach


Training / Mentoring

• Empty property officers are from a wide range of backgrounds and the level of knowledge and experience varies considerably

Training courses (Low Cost)• When negotiations fail • Compulsory Purchase Orders• Enforced Sales Procedure• Empty Dwelling Management Orders• Rd SAP, Decent Homes, Residential Property Tribunals• HHSRS, Enforcement HA 2004, Part L Building Regulations• Tracing People, Asbestos, Electrical / Gas, Freehold/Leasehold• Harassment & Illegal Eviction, Pace, Fire Safety, Mental Capacity• Individual LA Training (in house - Legal, Planning, Env Health & Building Control)• In total, over 830 Officers have attended the courses

• On the job training/ guidance as cases progress


Informal Advice & Website (www.no-use-empty.org)Awareness

• Newsletters, leaflets, mail outs• Developed databases for the authority• Estate agents / management agents, builders & developers

Advice & guidance always first course of action• Open day empty property owners in each area• Vat implications empty 10 years 0%, more than 2 years 5%• Capital Allowance Scheme (flats above shops etc)• Home improvement agency, list of builders etc• Advertise their property for sale for free / Auction reduced fees• Advice on method of disposal or options if renting• Guidance on planning – maximise profit etc• FOI request, will act as a referral service for an interested party.

Website• One stop resource for empty property owners and practitioners• Hotline and web reporting of empties• Extensive case studies


Maximising New Homes Bonus

• New Homes Bonus for new homes by match funding the additional council tax raised for new homes and empty properties brought back into use, with an additional amount for affordable homes, for the following six years (3 years left)

• Amount per ”new” home - 6 years council tax, at national average for band e.g. £1, 439 p.a. over 6 years for current Band D£8,634 total at current council tax rates

• Expensive homes generate bigger bonus• £350 flat rate extra p.a. per new affordable home

= £2,100 over 6 years• Some LAs only now undertaking data cleansing (Liberatar / Capita)


Achievements to date

• Strong partnership arrangements between KCC and the 12 District Councils

• Increased output, knowledge, expertise of professional staff and development and sharing of good practice.

• Extended the Initiative to all Authorities in Kent and gained National Recognition

• To date returned 2,201 long term empty back into use

• Bristol & West of England Authorities have adopted the “No Use Empty” model and branding.Adopting Loan Scheme Eden (6LAs)

• Regeneration & Renewal Partnership Working Award 2011Chartered Institute of Housing 2012 (Runner Up )


Question ?

• What can we do to encourage closer joint working throughout Kent & Medway and to continue to attract funding to deal with empty homes?

• Are LAs maximising their NHB?

• Are LAs robust in their recovery of debts against empty homes?

• What more could the No Use Empty Scheme do to help bring empty homes back into use?


Thank you for listening

[email protected](01622) 221906

[email protected] 07867987550


Steve (Suggestions) – do not put this slide up

• What level of funding should be available for the affordable housing loan scheme to make it viable for the owner. Are the suggested levels reasonable – discuss the scheme

• Government just announced additional funding for Empty Homes / Affordable housing limited info available

• Working closer with RSL partners to deal with empty homes (buy and renovate) or lease peppercorn rent – renovate property recover monies through rent / element of profit

• Empty shops, space above permitted developments• Would the LA that have achieved significant NHB, ring fence some monies

towards empty homes – goes into central pot.• Maximise NHB if the LA is not already doing this - letters, visit properties,

Liberator• Robust debt recovery in relation to empty homes

Documents

Www.no-use-empty.org Making the Best Use of Our Empty Homes by Steve Grimshaw Regeneration Project Manager