A new tax on “ghost homes” has reduced the number of empty private properties in Hampstead and Highgate.

The measure introduced by Camden Council to penalise owners who leave properties lying empty has reduced the number across the borough by 86 in the past nine months.

The levy has been hailed as a “needed tool in the armoury” to tackle housing shortage and Camden Council’s finance boss has now called on government to grant the local authority even tougher powers.

Some 162 empty properties across Camden will be charged 150 per cent council tax this financial year and the overall number of empty private properties has fallen by 34 per cent since it was introduced.

Data shows that more affluent areas of the borough have seen the least reduction – with 64 properties across NW3 postcodes still eligible. Highgate has far fewer properties affected, with only seven now qualifying for the levy.

Cllr Theo Blackwell, cabinet member for finance, said: “There are some people who basically don’t like paying tax. If they’re responding to that, then that’s good.

“There’s a wider public policy debate to be had across London essentially about the super gentrification of London by people who don’t live here.

“What people are getting quite annoyed about is the idea of what we’re calling ‘ghost homes’ – investors who are sitting on London property and not using it in any sort of socially useful way.”

Camden’s policy to charge 150 per cent council tax on homes empty for two years or more was first revealed by the Ham&High in September.

The council will also build 2,400 new homes in the next five years, but believes this measure is a small but important tool in the bid to tackle housing shortage.

Cllr Blackwell has now written to Communities Secretary Eric Pickles calling for the government to allow Camden to go further and charge 200 per cent council tax on properties left empty for one year or more.

He said: “It seems to have been a good signal to the market. It’s not going to solve everything but it’s one tool in our armoury. That’s why we’ve said can we have more powers and why we’ve backed 200 per cent council tax on properties and reducing the time to a year.

“We’re not trying to penalise home ownership, it’s just a question of fairness and I think a lot of people in Camden agree.”

But Julie Kelly, of Wellmanage Ltd property managers which oversees property in Camden, told the Ham&High in September: “It just seems like another way of extorting money out of private landlords. I don’t think it’s very fair.”

The proposals were introduced under the Local Government Finance Act 2012, which gives local authorities discretion to increase council tax on second and empty homes.

This week opposition Labour councillors on Westminster Council have demanded the policy is also adopted by the Conservative-led local authority.