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Centre Point debacle could be solved by Land Value Tax

Murad Qureshi says London County Council has 'unfinished business'

17 December, 2018 — By Murad Qureshi

Murad Qureshi

AN empty feeling can certainly be seen in the long-tortured history of Centre Point as both an office block and now as an apartment block.

As a landmark office block Centre Point lay empty for many decades and now the same may appear to be happening as it has been converted into residential homes, going by the remarks of the developers.

They announced that they are no longer putting up for sale the 50 per cent of flats that remain as no one is coming forward to make offers.

But this is not just happening at the top end of the office and housing market, properties lying empty after their conversion, but also at the other end of the property market.

Take a look at 70 to 76 Bell Street, NW1.

A few years back these properties were also converted from offices into four three-bed town houses which have now been empty for over two years and have not even been rented out in the meantime.

This may make sense financially on the bank balances of property companies but, economically, certainly not in the neighbourhood that many schemes are based in.

Councils like Camden and Westminster could do well to follow what another London borough is doing in the immediate future.

The Royal Borough of Kensington & Chelsea (RBKC) want more powers to get empty homes back in use to house social tenants, acknowledging some 621 long- term empties (empty for more than two years) within their borough boundary.

Yet Westminster Council appears to be in denial about this issue as they only accept 155 long-term empty homes in the borough.

As an adjoining and much bigger borough than RBKC, you would expect their figure to be much higher than the figure of 621 and certainly not as low as 155.

So some borough’s at least acknowledge the problem and are trying to do something about it. There is clearly a need for some consistency across the boroughs in putting some energy behind the blight of empty homes; but do not expect Westminster Council to take the lead.

More importantly, are there any solutions in the long run?

A much better mechanism would be an annual levy on the underlying value of the land, otherwise known as LVT (land valuation tax).

Such an annual tax would make sure that properties, whether with offices or residential, will not lie empty, or certainly not for very long. Too often we have seen major sites – like old Middlesex Hospital, West End Green site, and Chelsea Barracks – lie derelict for many years before any development is actually undertaken.

Such an annual levy would incentivise building and discourage land-banking. It is also has revenue-raising potential, and a reputation as the most economically efficient of property taxes available.

Why has it been allowed to exist this way for so long?

There are many vested interests in London property markets who want to keep it this way but others, like the Institute of Economic Affairs, discourage land-banking. It is also has revenue-raising potential, and a reputation as the most economically efficient of property taxes available.

Why has it been allowed to exist this way for so long?

There are many vested interests in London property markets who want to keep it this way but others, like the Institute of Economic Affairs, FT and The Economist, are committed to LVT.

It is also a bit of unfinished business from the old London County Council and Attlee government that would immediately benefit central London – reducing the empties that we have in our streets and skyline.

Murad Qureshi is a former Londonwide Labour Assembly Member.

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