Council faces £100k tax bill after ban on second home owners backfires
Red-faced bosses at West Norfolk Council have lifted the restriction on a £7m block of flats in a desperate bid to prevent the council becoming liable for its own empty homes premium.
The flats in Hunstanton – built by the council in a project part-funded by Homes England – were intended to only be sold to locals after being put on the market in December 2023.
But the coalition-led authority has failed to secure a single buyer for the 32 homes in an 'embarrassing' failure, which risks blowing a further hole in its finances.
The block of flats – called Styleman Court – is in danger of triggering the council's own empty homes premium.
It is thought the double tax bill the council will have to pay itself for the empty properties would be close to £100k.
Fearful of becoming a victim of its own penalty, councillors agreed to lift the ban on selling the flats to people whose principal homes are elsewhere in a behind-closed-doors meeting last month.
If buyers are not found, the empty homes premium will kick in from February 2026.
The Local Democracy Service reported that Simon Ring, deputy leader of the council, said: 'If the properties are still empty in a year's time, we will suffer the empty homes tax, which will be like being hoisted by our own petard.'
Lenders have reportedly been reluctant to offer mortgages on the seaside flats amid fears they would be unsellable in the future as a result of the buying restrictions.
Confidential papers seen by the Local Democracy Service state that removing the conditions will boost the value of each flat by an average of £39,500.
A spokesman for the council said: 'The restriction was introduced to ensure that people who bought the homes lived in them. However, this had the unintended consequence of making it harder for local people to buy the flats because it affected mortgage availability.
'While accepting that it also means people can buy the flats as holiday homes, the removal of the restriction is primarily intended to make it easier for local people to purchase them.'
'No one wants to permanently live there'
Independent councillor, Paul Beal, told The Telegraph: 'It's a lesson that's been learnt and a mistake can't happen again. The flats are built on a car park ... No one wants to live there full time.
'But as a holiday home destination, I think it would be fantastic. It's half a minute from the beach and you're two minutes from the town.
'Hunstanton was built for tourism, it is purely a tourist town and that's the way it has to be. It's our biggest industry so we should embrace it.'
Another councillor said the failure to secure a single buyer after 19 months was 'embarrassing'.
It is thought that construction costs for the project have gone almost £2m over budget due to delays and rising prices of materials.
The council refused to comment further on this figure due to it being published in a private report.
The flats are due to go back on the market without the ban on second home ownership. Six of the apartments are due to be kept by the council to be used as social housing.
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