DCLG and HM Treasury are consulting on further changes to the compulsory purchase legislation. Most of the changes do not seem to affect empty homes work but important changes to the arrangements for basic loss adjustment seem to offer some hope that CPOs of eyesore empties could become cheaper - depending exactly how the rules might be interpreted.
Under the current regime, basic loss payments are available to owners and occupiers, reflecting a typical split in commercial property between an instittutional investor that owns the property and a business that occupies it on a lease. Under current arrangements the owner gets 7.5% of the market value of the property (capped at £75k) and the occupier up to (but often less than) 2.5% of the market value of their interest (capped at £25k).
As the real costs of a compulsory purchase fall on the occupier, who has to relocate their business, the proposal is that the percentages and caps should be reversed, with the owner payment now to be capped at 2.5% of the property value up to £25k and the percentage and ceiling for occupiers increased. For an empty property, this would seem to indicate a reduction in the BLP to 2.5%.
This can only be welcome news for empty homes practitioners, assuming that owners are not treated as "occupiers" by default if nobody else is occupying the premises.
The Network will however press for the changes to go further and to reduce the loss payment to owners of "anti-social" abandoned or neglected properties to zero. These would be properties where
- there is no planning permission for change or use or redevelopment
- the property has been empty for 2 years or more
- the property has been subject to some form of enforcement action since it became empty (regardless of whether a notice is currently outstanding or not).