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Differentiating Between an Unoccupied and a Vacant Property

Updated: Feb 25, 2023

You may simply refer to a property that has been empty for a long time as "vacant" or "unoccupied". Same thing, right? Unfortunately, not, they are not the same, at least legally.

 
vacant office building in London

According to the most recent government council figures released in November 2022, there are 257,331 properties in England that are classed as long-term unoccupied. This means that they have been left vacant for more than six months.


The two names may mean something different, especially when it comes to insurance.

In this blog, we'll cover the definition of both, vacant property, and unoccupied properties, why it's important to understand the difference and why vacant property insurance is more expensive.


What is an unoccupied property?


An unoccupied property is a property that contains furnishings, like chairs, beds, or other furniture, but nobody is living in at that moment in time. There are several reasons why a property is unoccupied, it can be that the property has been abandoned by the owner and is not being used, an inherited home whose owner hasn’t taken possession yet or simply haven't decided what to do with it.


If you have a home that will be unoccupied for more than 30 days, no matter the circumstances, you might want to consider informing your insurance company. Failure to do so could void your cover in the event of an accident, burglary etc.


What is a vacant property?


A vacant property is a property that is vacant and not currently used, with no occupants or personal property. It may be vacant due to foreclosure, repossession, or sale situations, personal reasons, or needing repairs.


Examples of vacant property include:

  • Empty homes waiting to be sold

  • New builds that do not yet have a purchaser

  • Commercial properties that have been cleared

  • Unused warehouse, storage, or studio spaces

An abandoned property, to be demolished, or condemned property all fall under this category.


How many vacant properties in the UK?


There are currently over 200,000 vacant properties in the UK, including over 31,000 London alone. Vacant properties create a negative impact on local neighbourhoods by reducing property values and attracting crime and vandalism.


How many vacant commercial properties in the UK?


Recent research states that there are around 165,000 privately-owned commercial and business premises empty across Great Britain. In the retail sector the picture is even bleaker with 150 million square feet of vacant retail space, equivalent to 14.5% of retail units nationally. The growth in the number of vacant commercial properties is set to continue as the retail sector declines in favour of online shopping and office space contracts as more and more workers opt for remote working.


There are currently over 200,000 vacant properties in the UK, including over 31,000 London alone. Vacant properties create a negative impact on local neighbourhoods by reducing property values and attracting crime and vandalism.


How many vacant commercial properties in the UK?


Recent research states that there are around 165,000 privately-owned commercial and business premises empty across Great Britain. In the retail sector the picture is even bleaker with 150 million square feet of vacant retail space, equivalent to 14.5% of retail units nationally. The growth in the number of vacant commercial properties is set to continue as the retail sector declines in favour of online shopping and office space contracts as more and more workers opt for remote working.


Is your property unoccupied or Vacant?


Unoccupied properties are those that retain all (or many) of the possessions of the previous occupants, such as furniture and personal items, but have not had someone staying there for over 30 to 60 days. Vacant properties, on the other hand, are those that are completely empty, without furnishings or any signs of habitation.


Why is Vacant Property Insurance More Expensive

Vacant property insurance policies are intricate and therefore expensive. The cost of vacant property insurance comes down mainly to risk. Unoccupied property still displays signs of life, making them appear occupied to the outside world while a vacant property, often clearly show the signs of being "uninhabited " and this can attract thieves, vandals, squatters, and more.


Most insurers exclude vandalism, water damage, theft, and other losses when a building is vacant for more than 60 days. It's important to study the fine print of your policy to understand the cost of vacant property insurance in depth.


The Importance of Understanding Vacant vs Unoccupied Buildings for Landlords


Because there isn't a tenant or homeowner on site most of the time, any building that isn't in use poses a long list of hazards and risks.


Exclusions are more often found in insurance policies covering periods of when a property is empty and include:

  • No coverage for broken windows or vandalism.

  • Limited cover for water damage or theft.

The policy requirements for empty properties and the security standards you must meet increase exponentially in line with an insurer's perceived risk. For example, empty properties are at greater risk of accidental fire, (fire accidents affect 9,000 uninhabitable properties in the UK every year) making expensive preventative actions mandatory.


Vacant property insurance premiums might cost as much as three times more than those for unoccupied or in use properties (both residential and commercial).


Insurance Security Requirements for Vacant Properties

Regarding commercial property, any insurance policy will normally become void if the property remains vacant for an extended period of time, unless measures have beeb put in place to mitigate some of the risks associated with long term voids. Standard measures include:

  • All services to the building, such as gas, water, and electricity, should be turned off or isolated

  • Remove any valuable items, dumped waste, stagnant water, flammable liquids, or gas cylinders from the building's interior and exterior

  • Secure the building with locks compliant to British Standard BS3621, security shutters or screens, and sealed letterboxes

  • Drain down services (heating) especially if installing SITEX security screens

  • Arrange periodic void property inspections according to your policy requirements or property risk assessment

  • Install void property security technology, such as battery alarms, video verification sensors

  • Commission the services of a security company to manage the property, remove waste, monitor CCTV and respond to alarm activations

Security surveillance systems, vacant property alarms, mobile patrols, and window and doors boarding-up can all be used to enhance empty property security and safety.


Conclusion


Unoccupied properties can be challenging to manage, as they are more likely to experience property damage or theft. However, if property owners implement the right security measures, such as ensuring vacant properties are well-lit and regularly monitored by security personnel, they can help prevent property damage or theft. It is also vital to have an insurance policy that covers vacant properties, as it helps cover the cost of repairs if a vacant property is damaged or a thief breaks in.


Contact us if you have questions about property clearance or empty property security solutions. Propertysec is a market leader in vacant property security, trusted to secure, monitor, and protect empty properties and sites across the UK.


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