Labour has turned down calls from one of its own MPs to offer council tax exemptions for families struggling to sell inherited retirement properties.
Labour MP for Shipley, Anna Dixon had urged the Ministry of Housing, Communities and Local Government led by Deputy Prime Minister Angela Rayner to extend the period during which grieving families are exempt from the second home council tax premium when trying to sell retirement homes. These homes, which can only be sold to people aged 55 and over, are notoriously difficult to sell and often sit on the market for extended periods. They are also subject to high service charges and frequently lose value over time, further deterring buyers.
Currently, councils in England are allowed to charge a 100% council tax premium on second homes. Owners can avoid this surcharge if the property is on the market, but only for up to 12 months. After this period, the charge resumes regardless of whether the property has sold.
In a written parliamentary question, Dixon asked if the government would consider extending the exemption period to cover the full time a property is being actively marketed, particularly for leasehold retirement homes. Housing Minister Jim McMahon responded that there were “no plans to change the exceptions to the council tax premiums.”
Critics say this lack of flexibility unfairly penalises bereaved families. Retirement homes surged in popularity in the 1980s and 1990s, but now many stand empty for long stretches due to limited buyer pools and mounting service fees. According to property firm Hamptons, around one in 10 retirement flats takes more than a year to sell.
The issue gained national attention after reports highlighted numerous cases where families were being charged double council tax on properties they were unable to sell, with some facing thousands of pounds in unexpected bills.
Kevin Hollinrake, the Conservative shadow housing minister, criticised Labour’s stance, saying: “Labour should be actively reviewing how the new regime is working in practice. Their refusal to even consider extending the exemption for retirement properties shows a shocking disregard for bereaved families.”
Dennis Reed of Silver Voices, a charity for older citizens, also condemned the decision: “This inflexibility and obstinacy flies in the face of fairness. A hard-to-sell flat in a retirement complex is clearly not a second home. Labour should be showing some empathy to those who have lost a loved one.”
A spokesperson for the Ministry of Housing, Communities and Local Government defended the current policy, saying it was up to individual councils to decide whether to apply the council tax premium. “Councils can opt to add up to 100% extra on the council tax bills of second homes to help local leaders protect their communities,” the spokesperson said.
