What Are We Going To Do About A Problem Like Holiday Homes?

(I'm on holiday next week - stand by for guest blogs from Sarah Drane of www.purplecakefactory.com, a specialist in overseas real estate PR; and from Helena Halme, whose blog www.helenahalme.blogspot.com is one of the best I've read.).


I am an enthusiast of holiday homes, not only as a means of individuals enjoying their properties but also because they generate and redistribute income in favour of many areas which are not inherently affluent.

The small estuary town in which I live has about 10% of its stock serving as second homes, and they help bring south east-sized spending patterns to the south west, especially at peak tourism periods such as the summer.

But within the context of holiday homes being broadly a good thing, should we make holiday home owners pay more for their properties or at least give local people more choice over whether more houses and apartments can be used this way?

Three things could be done.

Firstly, holiday home owners could be obliged to pay full council tax. Currently, by law, councils in England must offer a second home discount of between 50% and 10% as the owners do not have permanent access to local services - but as that is their choice, why should they receive a rebate that permanent locals cannot receive?

Secondly, should there be an additional purchase tax on second homes? A few have suggested this but the proposal is riven with problems. What if a holiday home became a main home when the owners moved permanently to it? What about holiday home owners renting out their property, bringing income to the area from well-heeled tourists - should they still be taxed?

Thirdly, and an idea with support from surprising quarters, is that under the Coalition government’s Localism agenda, anyone wanting to buy a holiday home (or change an existing property into one) should win planning consent. This would give local authorities and residents a voice on the subject. Interestingly, the overwhelmingly-Conservative Cornwall Council has voiced approval for this concept, although it has no power to introduce such a measure without Westminster approval.

Whatever one’s views on holiday homes, Cornwall’s concerns are unsurprising: that authority, and some others, have suggested that high concentrations of holiday homes indirectly damage local services as schools, doctors’ surgeries and transport services become unviable when the permanent population falls, if more properties are bought by second homers.

Savills and Knight Frank have both undertaken research, often using local authority council tax data to quantify the issue. It appears some 245,384 British properties are holiday homes, while in key areas like Cornwall the proportion of ‘top end’ properties above £500,000 purchased as second homes could be as much as 50%.

They certainly inject money into the communities - but to avoid being seen as a problem for the permanent population, should their owners be made to pay more and do more before they buy?

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