First Minister pledges to work on cross-party basis to tackle housing crisis

Gareth Williams, local democracy reporter

The First Minister has indicated he would work across party lines to solve a housing crisis which has gripped much of rural Wales.

Wales has seen the biggest house price increases in the UK over the past year –  averaging 11% according to the Land Registry –  while established concerns about second homes have fulled fears over the ability of many locals to get onto the housing ladder at all.

In light of an even greater increase on Anglesey over the same period, the island’s MS pressed the First Minister to act on further planning and taxation measures to at least stem the growing crisis.

The latest Land Registry figures show an increase of just under 16% in the price of a home on Anglesey – now averaging £211,450 –  with reports of cases where even when locals buyers are getting together the asking price they have then been “gazumped by cash-rich buyers,” often from outside of the area and sometimes without having visited the property beforehand.

Rhun ap Iorwerth described the situation as a “crisis” with people “demanding to see urgent action taken.”

“One contributor towards this obvious emergency is the totally unregulated second homes market, I see it every day in my own village and especially coastal communities,” he added.

“I see it in empty streets and dark windows during the winter, the frustrations of young people unable to afford to buy in their communities and the 16% rise, things are getting worse every day.

“It’s right to differentiate between second homes and tourism, locally owned tourism businesses is a vital economic tool but unregulated second home ownership is not.

“Yes we need better jobs and to build more truly affordable homes, but your Welsh Goverment has to use every planning and taxation tool to bring the market under some sort of control and to offer some sort of hope and an opportunity for people in our communities.

“I urge you to offer a clear commitment or it will be too late.”

In response, Mark Drakeford confirmed that second homes was an issue he had offered to work on a cross party basis to solve, having already written to the leader of Plaid Cymru.

With Labour not holding a majority in the Senedd, such co-operation may be necessary in order to push through any resulting legislation.

‘Working together’ 

The First Minister went on to say: “I have seen Plaid Cymru’s five point plan and I’m sure there are ideas we can work on together, I agree that we need to use many tools including taxation and planning and others, bringing them together to try and make a difference and hopefully by working together.”

But North Wales Conservative MS, Sam Rowlands, said there was a need for more house building generally, claiming that looking at second homes only would cause a risk of “fiddling while Rome burns.”

Drakeford, responding, said the Government remained committed to building 20,000 new homes over the Senedd term, adding: “While we build more houses we do it in a way that properly balances the needs for new housing against the protections that local communities properly have so that their futures too can be safeguarded.”

Having commissioned Dr Simon Brooks with a report on alleviating the ongoing impact on mainly Welsh speaking areas, the Welsh Government has been urged to act on its findings which includes recommending 12 policy changes.

While calling on all authorities to increase their respective second home council tax premiums to the maximum permitted 100% – as Gwynedd has already done – other recommendations include a consultation on exempting short-term holiday accommodation from being eligible for small business rates relief.

Dr Brooks also called for a trial of new planning laws that would see a new use class for second homes, thus requiring planning permission to be in place before converting a property into a second home or short-term holiday accommodation.

In its pre-election manifesto, Plaid said it would change planning laws and allow councils to impose a cap on their number as well as refusing permission to change a dwelling from being a primary to a secondary residence.

Pledging to double the permitted tax premium from 100% to 200% the party also said it would “close the loophole” allowing their registration as businesses and avoid paying domestic rates and treble the Land Transaction Tax charge on second properties.

In its manifesto, Labour said: “We will work with communities to explore and develop effective tax, planning and housing measures – which could include local rates of Land Transaction Tax -to ensure the interests of local people are protected.”