Welsh Government unveils plan to tackle second homes – but Plaid brand it ‘weak’

The Welsh Government has unveiled its plan to tackle the second homes crisis, which is blamed for driving up prices and making communities in many rural areas unaffordable.

It will include setting up a pilot area in Wales – to be decided over the summer – where new measures will be trialled before a wider rollout.

In the Senedd today, Minister Julie James will set out an “ambitious three-pronged approach” to address the impact of second home ownership.

However, the plan has already been slammed as “weak” by Plaid Cymru who said it was “an exercise in kicking the problem into the long grass”.

The Welsh Government’s three-pronged approach will focus on:

• Support addressing the affordability and availability of housing;
• The introduction of a statutory registration scheme for holiday accommodation;
• Using national and local taxation systems to ensure second home owners make a fair and effective contribution to the communities in which they buy.

A Welsh Language Community Housing Plan, to protect the particular interests of Welsh language communities, will also be published for consultation in the autumn.

Minister Julie James said that the continuing rise of house prices meant that people, especially younger generations, could no longer afford to live in the communities they had grown up in.

“A high concentration of second homes or holiday lets can have a very detrimental impact on small communities, and in some areas could compromise the Welsh language being spoken at a community level,” she said.

“We have already taken strides on some of these issues – last year we became the only nation in the UK to give local authorities the power to introduce a 100% council tax levy on second homes.

“But the urgency and gravity of this situation calls for further intervention, which means real and ambitious actions are delivered at pace, to inject fairness back into the housing system.

“Taking recommendations from Dr [Simon] Brooks’ report, our new three-pronged approach will kick-start a summer of action which will determine how we tackle this issue now and into the future.

“I am calling on all political parties across the Senedd to get involved in this, as we look to empower our communities to exercise their right to live in good quality homes, wherever they are in Wales.”

‘Weak’

Responding to the Welsh Government’s plan to tackle second homes announced today, Plaid Cymru Housing Spokesperson Mabon ap Gwynfor MS however said he was unimpressed.

“This so-called ‘ambitious approach’ to tackle the second homes housing crisis is an exercise in kicking the problem into the long grass without taking the necessary urgent action to deal with the crisis facing our communities,” he said.

“These weak measures will not be nearly enough to truly get to grips with a housing emergency that is fast engulfing our communities at an alarming rate. There is nothing here about closing the council tax loophole. There is nothing here about imposing caps on second homes.

“And there is nothing here about bringing numbers of holiday homes into community ownership through public intervention – diverting profits to local developments such as the provision of social housing. In fact, there is no detail just vague plans for more consultation.

“What our communities need is urgent action before it’s too late – not painfully long-drawn-out consultations or half-hearted trials.”

He said that Plaid Cymru called for direct interventions to mitigate the housing crisis, such as:

• Changes to planning laws to allow councils to impose a cap on the number of second homes
• Trebling the Land Transaction tax on purchases of Second Homes and close the loophole; that allows second homeowners to register their property as a ‘businesses’ in order to avoid paying the council tax premium;
• Amending the Local Authorities Finance law to empower local authorities to better control the housing stock.

“The housing crisis facing Wales is not confined to a few isolated far away communities. It has a knock-on effect in every community the length and breadth of our nation,” he said.

“The Labour Government owes it to the people in these communities to address the crisis with the seriousness and urgency it deserves – ensuring they can live and work in the area they call home.”

‘Relocate’

Visiting a housing development in picture-postcard St David’s, Minister Julie James met with members of the local community, Pembrokeshire Council and the Community Land Trust.

They have been working together to use money raised from the council tax levy to build 18 new affordable homes for local people.

Josh Phillips, 33, pub landlord at Harbourside Inn in Solva and chair of the Community Land Trust said that young people were being driven out of their communities by high prices.

“The current housing market in Pembrokeshire is at an all-time high with properties locally being snapped up for well above asking prices,” he said.

“The Solva Community Land Trust is a pioneer development for community-led housing in Wales and hopes to deliver 18 properties locally within the next three years.

“Our vision is to create housing that is affordable and environmentally low impact, helping to stem the tide of young people having to relocate and draining our community of their energy and talents.”

Rachel Kelway-Lewis, 25, from Solva, Pembrokeshire added that the Covid-19 pandemic had added to the housing pressures.

“Since the pandemic and the increase in home working, more people are looking for property here, with some houses going for over £500,000 and selling extremely quickly,” she said.

“Some of these houses will be vacant for much of the year, or are used as air bnbs rather than renting to locals, increasing rent prices for us, too.

“All of my friends are experiencing the same issues. We’re working full time but we can’t buy or even rent in the local area, unless we’re lucky enough to have financial help from our parents. Lots of my friends have had to move away to get on the housing ladder.

“We need opportunities for young people like me to remain within our community and contribute to our local economy – so it’s great to be heard by the Minister and know she is doing something to help us out and tackle the issue of second homes, which is creating a demand us locals simply cannot currently compete with.”