John Walsh: Tales of the City

I've walked past the house on Lordship Lane in Dulwich a hundred times, and wondered how such an elegant building could be dying of neglect. Its graceful proportions, arched windows and luxurious gables suggest a distinguished provenance, but it's now an empty wreck. The trashed roof, the boarded-up windows, the planks shoring up the frontage all give the place a look of ineffable melancholy – as if it were aghast at the way its life has turned out. I discovered it was once the rectory to St Peter's Church, that it was built in 1873 by one Charles Drake of the Patent Concrete Building Company, and is apparently the only surviving example in England of a Victorian "concrete house". But its present owner can't be found, and Southwark Council won't demolish it because it's a Grade II-listed building. So it stands in limbo.

The house turns up as the first entry in a new book, Derelict London (Random House, £9.99), whose author, Paul Talling, prowled the metropolis for five years photographing the wretched, the ramshackle, the tumbledown and the downright sinister. From the forlorn suburban terraces on the North Circular Road to the creepily prison-like, rat-infested Ferrier estate in Kidbrooke, from the closed-down rock pubs of Soho to the vast disused granary (as featured in Ashes to Ashes) of the Millennium Mills in Royal Dock, it offers a moving chronicle of living spaces that died and, for the moment, are not being revivified.

So you begin to wonder: how many run-down homes are there in London, and why can't they be repaired? There are 86,000 of them, a figure which nicely matches the figure for London's homeless population of 150,000: two people for every empty dwelling. So is it beyond the ingenuity of local councils and housing authorities to bring houses and homeless together?

You read the housing pledges made by London's mayoral candidates, and find them parroting similar lines. Ken: "I will build 50,000 affordable homes." Boris: "I'll work with boroughs to build 50,000 affordable homes." Brian: "What London needs is affordable rented accommodation." Enough, already, with all the new houses. Building from scratch is very expensive and it uses tons of energy. Why not do something radical, and spend money restoring dilapidated houses to life?

For guidance, I went to see the Empty Homes Agency at its London Bridge HQ. It is "an independent, campaigning charity" whose raison d'être is "to highlight the waste of empty property in England" and dream up solutions for bringing it back into use. "If we refurbished London's 30,000 long-term empty homes," says Henry Oliver, their policy adviser, "we could save more than a million tons of CO2, compared with building from scratch." He and his colleagues lobby local councils, but it's an uphill struggle. For one thing, the Government is far keener on house-building than renovation. "Its emphasis on new-build," says Oliver, "is becoming an obsession. And the signal they're giving to local authorities is that they shouldn't concern themselves with renovation, because that stuff just doesn't matter."

One problem is that the vast majority of empty-wreck houses are privately owned. Only 15 per cent are council property and usually have a tragic story to tell. Either they're horrendous tower blocks inherited from the 1960s, so grisly and disheartening even people on council waiting lists won't live in them; or they're places where the more enterprising and ambitious have exercised their "right-to-buy" option, sold their houses into the wider housing market and moved on, leaving their neighbours stuck in a Losers' Lane of poverty, unskilled labour and poor education. Or they're districts which use to employ an army of unskilled labour – think of the biscuit or candle factories in Southwark and Wandsworth – but whose employer closed down, taking the jobs with them. "And now you see a lot of council housing being sold to housing associations, in order to build more houses," says Oliver. "Their objective is to build three times as many houses, rather than to look after and manage and maintain the properties they already own."

The main reason, however, for the lack of action to rescue desolate properties across London (and, of course, across England – the total figure is 680,000 empty homes) is a financial one. For decades, building new houses incurs no VAT liability. Repairs and renovation of property, on the other hand, lands you with a socking 17.5 per cent VAT bill. The reasons for this inequality are lost in the fog of fiscal legislation under the Wilson government in the mid-1960s, but the shackle of VAT must have dissuaded thousands of would-be renovators in the past 40 years. There are some discounts and exceptions available (if a building has been empty for 10 years and you're turning it "back to use" you pay only 5 per cent), but you'll probably, in turn, have to sign a five-year lease with a housing association, allowing local tenants to live there.

How controversial could it be to ask the Department of Communities and Local Government, or a London council, or indeed the new mayor, to propose a reform of the legislation on empty houses, a relaxing of the constraints that stop Londoners bringing the capital's most tragic buildings back to life? Or would we rather just ignore the dereliction that shames the capital, while we gaily steer the lower-paid and the needy into "affordable" new shacks in Walthamstow and Purley Oaks?

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