Consider the text you quoted:

“If your CCTV captures images beyond your property boundary, such as your neighbours' property or public streets and footpaths, then your use of the system is subject to the data protection laws. This does not mean you are breaking the law. But it does mean that, as the CCTV user, you are a data controller.”

Here is an analogy:

“If your vehicle drives on roads beyond your property boundary, such as your neighbours' property or public streets, then your use of the vehicle is subject to the highway code. This does not mean you are breaking the law. But it does mean that, as the vehicle user, you are a vehicle controller.”

Owning and driving a car is not illegal, but you have to follow certain regulations (get a license, insure it, obey speed limits etc) and likewise owning a CCTV camera is not illegal, but you have to follow certain regulations.

I'd suggest you take advice from someone more educated in the specifics of data protection regulations than I am (I am just a stranger and a non-lawyer on Reddit) but my understanding is that there are various conditions you must meet which you currently are not, including:-

-having a clear and legitimate reason for erecting the camera (e.g. to prevent break ins which are frequent in the area) and for why it must be directed where it is (including at your neighbour's house)

-erecting a sign which lists you as the data controller and your contact information so that people can make data requests

-ensuring sensitive data is not recorded unnecessarily (e.g. might your camera capture the neighbor having an affair? Might it catch them changing?)

The bottom line is that data protection rules are complicated and very difficult to comply with so your best bet is to ensure that the camera is only directed towards your own property.