Holiday homes are ‘hollowing out’ coastal areas, says MP | Housing

Coastal communities are being “hollowed out irretrievably” by a surge in holiday homes, an MP has warned, as new figures showed more than 17,000 properties in England have been “flipped” into short-term lets since Covid-19.

The poll came as MPs and campaign groups warned that vital public services – including schools, trains and buses – were in danger of vanishing from tourist hotspots due to a shortage of affordable homes.

“We’re sleepwalking into a new chapter of the housing crisis where communities are being hollowed out in a way that is irretrievable,” said the Labour MP Luke Pollard. “We’re beyond the tipping point in some places.”

The Covid pandemic has “turbo-charged” the housing crisis in many rural and coastal communities, Pollard said, as wealthy outsiders snap up holiday retreats – taking properties off the market and pushing prices beyond the reach of local residents.

This week, residents in the Yorkshire seaside town of Whitby became the latest to voice their anger about the housing crisis when they voted overwhelmingly for curbs on second homes.

House prices in seaside resorts increased by 13.9% on average last year, outpacing the national rise of 9.9%, according to the property website Rightmove. All but one of the 10 areas where house prices have doubled in the last decade are by the sea.

In Whitby, there are 20 times more Airbnb listings than properties available to buy on Rightmove, according to research by the Guardian – 1,349 short-term lets compared with 67 homes for sale.

In Cornwall, there were more than 13,000 holiday stays online in April – compared with 3,103 properties for sale. The homes available in these areas are generally far beyond the means of the local average salary.

Julian German, the former independent leader of Cornwall council, said the loss of permanent residences in the area he represents – Roseland, south of Truro – was “staggering”.

German said: “Fundamentally, it means the end of these communities as people cannot afford to live in them – the end of the traditions and culture that have bound these communities together.”

He added that the region’s tourism trade faced a bleak future without further government intervention, warning: “The golden goose will be killed.”

Second home owners have sought to capitalise on the boom in domestic holidays during the pandemic.

Owners of 17,135 second homes in England have “flipped” their properties to become holiday rentals since March 2020, according to research for the Guardian by real estate adviser Altus Group. More than a third of these properties are in the south-west of England.

In many desirable locations, most properties are now second homes. In the Devon resort of Salcombe, 57% of properties are holiday homes, rising to 80% in Hope Cove and 95% in Thurlestone Sands.

Anthony Mangnall, the area’s Conservative MP, has warned that doctors, nurses and teachers were among those being priced out by a housing crisis that has grown “distinctly more alarming” since 2020.

Under pressure from MPs, including Conservatives in the south-west, the government has sought to close a loophole that allows second home owners to avoid paying council tax if they can show the property was available to let at least 140 days a year – even if it is never rented out.

Owners of holiday homes are entitled to claim 100% of small business rates relief if their properties have a rental value of less than £12,000, meaning they pay no business rates or council tax.

From next April, second home owners in England will have to prove that holiday lets are rented out for a minimum of 70 days a year to access the small business relief.

But campaigners want ministers to go further. The Welsh government plans to introduce a 300% council tax premium on second homes and make it harder for those properties to be eligible for business rates instead of council tax.

One idea is for a “last shop in the village fund” whereby councils can charge a levy on empty second homes to support dwindling community services such as the post office, pubs, buses and pharmacies.

Dan Wilson Craw, deputy director of housing campaign group Generation Rent, said: “It’s no good places like Whitby having a roaring tourism trade if no one can afford to live there. It’s essential that newly built houses actually provide homes to locals, but without further measures, would-be second home owners will simply snap up existing properties.”