The UK's Empty Property Rates (EPR) system is paving the way for future instability in non-residential property markets as property owners are increasingly turning to demolition to avoid paying the rates whilst cutting back on future investment, according to the results of a new study published by the RICS and Lambert Smith Hampton.
The UK's Empty Property Rates (EPR) system is paving the way for future instability in non-residential property markets as property owners are increasingly turning to demolition to avoid paying the rates whilst cutting back on future investment, according to the results of a new study published by the RICS and Lambert Smith Hampton.
The authors say the Empty Property Rates Survey - the first industry review of the tax following its controversial introduction a year ago - demonstrates that rates on empty properties are exacerbating the financial difficulties of many property companies and occupiers. Some 93% of respondents questioned agreed with this view.
According to the report, the rates have led to an increase in the demolition of perfectly sound properties. Some 75% of respondents agreed that there had been an increase in the demolition of properties and 85% believed this was to avoid paying the rates. In addition all sectors saw a decrease in investment of new properties, with the industrial sector being the hardest hit. Some 79% of respondents believe that empty rates are having a detrimental effect on town regeneration and speculative development.
