Insurance cover on mortgaged homes can lapse within weeks
Scotland and England are moving to tighten rules on long-term empty homes, while buyers of vacant properties needing work typically rely on bridging finance and specialist lenders.
In Scotland, the 100% cap on the council tax premium for empty homes was removed from April 1, 2026, and a default council tax premium of 100% now applies to homes empty for more than 12 months.
The Scottish Government has also allocated £700,000 across 10 councils for repair and refurbishment grant schemes, taking its empty homes investment to £2 million this year.
The UK government announced on September 27, 2026 plans to let councils in England pursue an Empty Dwelling Management Order on a property empty for six months, down from two years, with no implementation date yet set.
Nicholas Mendes, mortgage technical manager at John Charcol, said ownership does not pass to the council under an order, so “the mortgage remains entirely the borrower’s responsibility throughout”.
Lending conditions apply before council action
Mendes noted most standard buildings insurance policies restrict cover after 30 to 60 days of vacancy, and maintaining suitable cover is typically a mortgage condition. Borrowers who leave a mortgaged property vacant face potential mortgage covenant breaches well before any council considers enforcement.
Data compiled by digital insurance broker Ceta Insurance puts the number of empty UK homes at around 750,000, the highest total in more than 10 years. Ceta said its 2025 sales of unoccupied property cover were 500% higher than in 2020.
Bridging finance funds refurbishment purchases
Renovation and repairs accounted for 38% of the 3,335 known cases of Scottish homes becoming empty, matching the share for an owner’s death. Among 2,662 cases where homes stayed empty, repairs were ongoing in 28% and had stalled for financial reasons in 4%.
Inheritance is also a route into letting, with Rely’s Next Gen Landlords research finding 36% of aspiring landlords expect to inherit property, compared with 27% of landlords today.
House Buyer Bureau values England’s 303,185 long-term vacant homes, empty for more than six months, at an estimated £88.6 billion.
Specialist property-finance guidance cited in the same report states buyers of such properties typically rely on bridging loans, refurbishment mortgages or specialist renovation products rather than conventional lending.
New regulated bridging loans taken out by UK homeowners reached £1.83 billion in the year to March 31, 2026, up from £1.75 billion, according to Karis Capital.
“In a property market that is being slowed for the moment by fluctuating interest rates, bridging loans give some buyers a different route to get their property purchases completed,” said the firm’s Francesco Amato.
Prices diverge in Scotland’s empty homes hotspot
Aberdeen has Scotland’s largest number of empty homes at 6,124, or 13.78% of the national total. Average prices in the City of Aberdeen fell 5.2% to £133,782 in the year to August 2026, compared with a 2.9% rise to £198,397 across Scotland.
Record returns in Scotland
The Scottish Empty Homes Partnership recorded 2,285 empty homes returned to use in 2025-26, the highest total since 2010 and 11% more than the year before, bringing the total since 2010 to 15,240.
Council tax data from September 2025 showed 44,453 homes empty for six months or more, including 32,337 vacant for at least a year.
Advice from council Empty Homes Officers accounted for 89.10% of homes returned to use, council buybacks 8.71% (up from 4.36%), loans and grants 1.84%, and compulsory purchase orders 0.13%.
The Scottish Parliament backed a national housing emergency declaration in May 2024, and 14 councils declared local emergencies. In 2025-26, 19,004 households were in temporary accommodation, including 10,715 children, and 35,002 were assessed as homeless.
