Very very expensive council tax

[Ohnanawhatsyourname]

Hi all

In the process of buying a modest property that’s really run down and needs lots of work, have budgeted for that based on what I saw of it to date and getting very detailed surveys done. Yes I know, great time to buy lol :( the mortgage rate is awful.

however - just discovered like an idiot that the council tax on the property is super high for the area, about £3k a year (all other properties in the area more like half that).

I’m already arguing with the seller as they had asked for a super high sale price and not taken into account the works needed (like asap) on the property. They wanted to sell as if it’s fully renovated and as if it’s a much bigger place when they haven’t done much needed work in genuinely 40 years. They’re not working off any valuation, just their general intuition.

Anyway is council tax something you can also use to justify a lower price on?! Just grates as can’t believe it’s SO high for this property.

Any advice much appreciated

I agree that council tax banding is ridiculous and needs changing. Two examples from my experience -

1. Our previous house (West Midlands) was a four bed detached period property of around 2000 sq ft worth £300k in 2015 and was in Band G.

At the same time an acquaintance owned a larger (2500 sq ft) 4 bed detached period house (Henley on Thames) worth £1.2m - also in Band G.

2. Years ago we owned a six bed detached period house (Hampshire) of 3500 sq ft. Worth £600k in 2007 and closer to £1m now - Band F.

A neighbour who had exactly the same footprint house but which had been divided into two (the family owned the entire property but the BIL lived in an 'annex flat') - was paying Band B x 2.

I've never been able to get my head around this.

Council tax has nothing to do with the condition of the property and is irrelevant. The house is only worth what someone is prepared to pay for it. Reduce your offer if you wish but don't mention council tax for the reason. Your offer is right if you wouldn't be upset if they say no and accept a higher offer from someone else. If that happens and your main reaction is to pity the fool who overpaid then you pitched your offer correctly .

It's all down to the local authority banding price/rate structure. For instance Wandsworth borough pay significantly less for a property sitting in council tax D than say various boroughs within Hampshire with a property sitting in council tax band D.

Different local authorities have to pay for different things within their council tax monies generated. Hampshire boroughs may be paying a higher bill towards social care due to a more elderly population (accepting that social care doesn't just cover the needs of elderly residents). Wandsworth borough generates monies in other ways - higher parking charges, higher parking permit charges etc.

Also down to what band the property sat in when the bands were structured in the first place. Then allow for extensions etc that change the banding over time.

i know you want to be on the property ladder, but you might be setting yourself up for hardship in the long run. that council tax is very very expensive, as you even say, and is it really worth it just to get on the property ladder??

What council tax band is it actually in?

That's what you need to focus on, and whether properties of a similar size and value in the locality are in a lower band. If they are, then you stand a chance of appealing, to get it moved down a band.

1) Our previous house (West Midlands) was a four bed detached period property of around 2000 sq ft worth £300k in 2015 and was in Band G.

Band G properties where i live are £3700 per year.

Differant local authorities have differant rates of council tax for a certain band.
You will find that rural properties tend to have higher valuations - therefore more expensive for a typical band D or E. Fewer CT payers to maintain services.
Value of the house now is irrelevant.
I suspect this house you are buying is rural, needs work and was once (1991) a very much better house with views.
Only thing you can do is to attempt a revaluation once you have bought it but there are no guarantees you will move down a band - you might move up!

We pay £3000 a year and our house is a moderate family house, terraced.

When Council Tax was first brought in, Local Authorities took a pretty rough and ready approach and would often lower the band when challenged - I believe within 10% value. We challenged on our previous house so we were on one band and all our neighbours, who hadn’t challenged at the right time paid more on identical houses. I believe you are still allowed to challenge on purchase but you had better do your homework as LAs won’t take such a lapse approach nowadays.

Richmond, Surrey council tax is cheaper than many poorer areas - go figure!
It makes zero sense.

Council tax bands and rates will depend on your council's spending, and density of housing, people in need.

Perhaps more people who pay it, perhaps less people who need supporting in Richmond....?

If it has the wrong banding, you can apply on moving to have it revalued. I would research carefully as near as identical houses nearby tax values - see if you can find several that are same or bigger houses and lower banding.

However they may just put those properties up and not adjust yours!