The rise of second homeownership in the UK has had a substantial impact on local communities, particularly in rural areas, pushing prices up and forcing many local people out of the housing market. This dramatically increased during the pandemic when the demand for UK getaways was at an all-time high. Some councils around the UK will now take drastic action. From 1 April, Cornwall will charge an additional council tax premium of 100 per cent on second homes.
A 100% council tax premium will also be introduced by Bath and North East Somerset, East Devon, North Norfolk, Southampton, Southwark and West Norfolk. This is part of the Levelling-up and Regeneration Act 2023, which allows local authorities to charge a premium on second homes.
The 2021 UK Census found the South West had the highest percentage of second homes with no usual residents, out of all English regions. This was closely followed by Wales. A large number of holiday or second homes can be detrimental to villages and small towns, with houses taken up by people who occupy them only for short spells and don't contribute to the local economy and community life year-round.
The demand for second homes pushes up the price of houses in an area, which often means those who live there all year-round can no longer afford to do so – and are slowly pushed out into surrounding areas.
In April 2023, the Welsh government gave local councils the power to add a council tax premium of up to 300% on second homes. This has ultimately led to a fall in house prices in areas where this premium has been introduced.
BBC News reported that Gwynedd in north-west Wales had seen a 12% year-on-year decline in house prices, following the introduction of a 150% council charge premium on second homes or holiday lets (having previously increased it from 100% in 2023).
Pembrokeshire in south-west Wales introduced an even higher premium of 200%, which has led to a threefold increase in the number of second homes for sale there.
While holidaymakers undoubtedly contribute to the local economy, the businesses they support can only be sustained by staff – many of whom are now forced to commute into these places because they can no longer afford to live there. Due to the impact of rising house prices, it's said second homeowners tend to take more out of the local economy than they put in.
As the number of permanent residents declines, vital local amenities such as post offices, schools and train stations can be lost. Some areas can become entirely uninhabitable during the off-peak season, with all other industry sacrificed in favour of tourism.
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Main image: People gather on the beach beside the harbour at St Ives in Cornwall, England. Credit: Getty Images
