£50bn price tag for London's empty homes

Southwark, Barnet, Camden, Croydon and Newham are the top five London boroughs with the highest number of vacant properties amid a worsening shortage of homes in the nation’s capital.

According to our analysis of data from all 33 local government authorities, 87,763 houses stood empty across London in 2023. The total value of these properties is worth an estimated £50 billion, with a quarter of the city’s empty homes concentrated in these five boroughs.

Yet London is seeing increasing demand from prospective buyers along with lengthening waiting lists for social housing. Across the country, the government has set targets of building 300,000 new homes per year in order to tackle the housing crisis.

Empty homes block housing supply

Empty homes continue to be a major obstacle for London’s housing supply, but we have recently seen an increase in efforts to get vacant properties back on the market and unlock the £50 billion tied up in empty homes across the city.

Such efforts include the ability for local councils to impose heavier premiums on properties that have been vacant for a year or more, and there may be more regulatory changes to come. If these changes do succeed in encouraging owners of long-term vacant properties to sell or rent, there may be opportunities for property investors and property managers.

Here we look at the top five boroughs, and the investment opportunities they offer:

Southwark’s empty properties valued at £2.77bn

Southwark had the highest number of empty homes of any London borough in 2023, with 5,143 properties sitting empty last year. The combined value of these properties is estimated to be £2.77bn, which is the third highest of any London borough.

In recent years, Southwark has become an increasingly attractive place to invest, with regeneration bringing more people and businesses to the area. The borough has several first-rate attractions like Borough Market and the Tate Modern, as well as plenty of options for restaurants and nightlife, all within walking distance of central London as well as ongoing development.

Barnet has second highest number of empty homes worth £2.75bn

With 4,614 vacant dwellings, Barnet had the second-highest number of empty homes of any London borough last year.  The estimated combined value of Barnet’s unoccupied properties was £2.75bn, representing the fourth highest total of any borough.

The outer borough is known for its strong transport links to central London and convenient access to the surrounding Hertfordshire countryside. Regeneration schemes like Brent Cross Cricklewood are also helping to create new jobs and bringing more people to the borough.

Camden’s empty homes estimated at £3.5bn

Although third on the list Camden’s 4,320 empty homes are valued at an estimated £3.5bn, second only to Kensington and Chelsea (£4.2bn) among all London boroughs.

A hot spot for locals and tourists alike, Camden has some of the highest house prices of any London borough. Along with Camden Market, the borough boasts leading live music venues in the form of KOKO and Roundhouse as well as ample green space with Regent's Park on its doorstep.

Croydon’s £1.58bn is lowest worth of the top five

The outer borough of Croydon had 3,946 vacant dwellings recorded in 2023. It has some of the lowest average house prices of any London borough and so does not appear in the top ten for estimated value of vacant properties (£1.58bn).

Known as a commuter hub, Croydon offers excellent transport link with four rail stations and quick access to central London, Gatwick Airport and the M25. Investors can also benefit from plenty of green space, great shopping facilities and a thriving food and drink scene with venues like BOXPARK.

Newham’s vacant dwellings worth £1.65bn

With 3,812 vacant dwellings, Newham ranks fifth. Like Croydon, Newham’s house prices are low relative to the rest of London, with the total estimated value of its empty homes (£1.65bn) falling outside the top ten. The borough offers strong rental yields, which can make it an attractive prospect for buy-to-let investors.

Newham has benefitted from considerable investment in the last 15 years, most notably from the 2012 Olympic Games. It also offers easy access to the Thames and a short commute to central London, making it a convenient place to live.