A money saving reason to renovate an empty house

Finding an unoccupied house to buy may not just avoid house-buying chains, but can also attract VAT and council tax reductions.

Properties, which have been vacant for more than six months, are officially classified as empty.

It is thought that streets with empty dwellings attract greater criminal activity, as well as devaluing the property prices for other residents. Councils, therefore, have up to 50 per cent reductions in council tax as an incentive for new occupants to be found.

In addition, there are government grants for properties which have been vacant for over two years, which reduces the resale VAT rating to just five per cent. A property vacant more than ten years, which is renovated and sold, attracts a zero rate of VAT.

Jaedon Green, head of mortgage product development at Halifax, commented: "The number of empty homes in England has fallen by nearly 20,000 over the past three years but more needs to be done.

"One in four people continue to be directly affected by an empty house which they believe has a negative impact on the value of property, their enjoyment of the area and levels of crime."

House buyers will, however, need to consult with their home insurance providers as well as mortgage lenders because most empty properties will need major renovations such as rewiring, new plumbing and structural repairs.

10/12/2007 13:02:50