The 2021 census found that there was a significant fall in the number of vacant residential properties in the Isle of Man with the number of vacant properties now lower than the previous decade from 2011 to 2021.
As we look to the future, it seems likely that there will be continued high inflation in the short to medium term (but not, I think, in the long term!).
In a world of very low inflation and very low interest rates, it was relatively inexpensive for people to leave vacant properties empty and unutilised. People were able to be relatively more speculative and patient with their ownership of such properties, because of the huge supply of capital. Limited investment returns elsewhere meant that loans had relatively low ongoing costs: the cost of capital was very cheap.
A world of higher interest rates is fundamentally different, because people who own such properties are going to face a higher cost of capital. It will be harder for them to justify to themselves leaving such properties vacant, because there are likely to be better things to do with that capital, and loans will have higher interest rates.
Consequently, high interest rates will likely put further downward pressure on the number of vacant properties in the Isle of Man.
