Second Home owners doing sad faces in the press about council tax increase

[CornishTickler]

Just read an article online about the second home council tax increase and there are couples with sad faces saying it was without warning and is against their human rights! It wasn't, its been in the press and talked about by councils for over a year. It wasn't a surprise, areas with high levels of second homes knew it was coming.

I for one am glad about the tax. Our village has been destroyed by second home owners for years. A lot are badly maintained and empty for 80% of the year.

The argument that they bring extra income is also misleading. Most true second home owners who only visit a couple of times a year don't contribute much to the economy but are very vocal in interfering in local issues to the detriment of actual residents. One example (I'm not joking on this) was to oppose the planning of a local business that would benefit the community with jobs and tax revenue because of the endangered newts! luckily common sense prevailed but honestly they got very vocal and aggressive about it. It was mainly because they didn't want it to impact their second home.

Holiday makers bring revenue. Absentee second home owners do not.

Hopefully the second home tax increase will increase council tax revenue and help to support our community and vulnerable people.

There's more to it than helping the local economy, because second homes don't really help that much. They only really help the people that own them & let them or provide work for a few people cleaning & maintaining every week, that's it.
I live in a small coastal village where a lot of the houses & flats have become holiday lets and second homes. This is bad for the local area as there are fewer homes for the young to buy so they can carry on living here when they leave their parents houses & want to stay here to be near family & work.
Key workers for care homes, the nhs schools etc can't get accommodation in order to take up their posts. Our local care home closed last year because they couldn't get enough staff to keep the residents safely cared for as new staff couldn't find anywhere to live. Our village grocery shops are closing too because they don't have enough income during Winter to stay profitable and keep going.
We need to have a minimum amount of children in our school to keep them open or they will close and children will have to be bussed to the city every day which is a very long trot both ways it's at least 70 miles each way. But if families with school age children can't get housing that's what will happen.

The amount is peanuts in terms of the overall budget and is likely to be sucked into the black hole of essential services. Either way the numbers are not going to generate much in the way of jobs - that needs a longer term strategy around industry and transport.
Some of these councils have a shocking history of failing to prioritise local people and jobs over vested interests. Voting patterns in the West country have changed a bit - maybe that will make a difference, maybe people are less inclined to vote for the proverbial donkey with the right rosette or family name. I'm sure its similar in other areas, I simply know that part of the world better.

I don't have strong feelings either way about the CT multipliers - it might trigger some genuine sales but I don't see it dramatically affecting actual sold prices any time soon. Anyone facing a substantial capital loss on a sale is simply going to suck up the extra tax for a few years until the model shakes down and prices settle. Putting houses on the market is not the same as achieving actual sales - you need decent accessible jobs in the area to turn second and holiday homes into first homes for families.

The multiplier will make people feel good for a while as it feels like "doing something" but its jobs and transport which maintain communities, not kicking out holiday homers.

Surely you can see that unless the markup is ridiculous, a bakery needs more than 2-4 months of trade to survive. In an area where second homes are the minority, they can probably get by on local custom, with your purchases just being a bonus. However when villages are 75% second homes the amenities cannot be sustained and the soul is sapped out of them. That is what this policy is intended to solve.

It's not a black hole. It's not infinite and expanding. It's a number. If the council overspends it will draw down from reserves, so any additional income will reduce that.

Taking Cornwall as an example (because it's been talked about a lot), it's estimated that over 14,000 properties are second homes (https://www.bbc.co.uk/news/articles/cj9ejjyeeelo.amp). Taking band C as a middling council tax band, which is £2,186.60 in 25/26, charging double council tax would bring in an extra £30.6m pounds. This would cover the overspend (expected to be £20.5m for 24/25 in January - https://www.cornish-times.co.uk/news/cornwall-council-warns-it-is-facing-financial-cliff-edge-within-two-years-659711).

Obviously, if the properties are in higher tax bands, the income would be higher.

If charging extra council tax leads to houses being sold and more people having somewhere to live, that's great. If it leads to more income for local authorities to spend on meetingthe needs in their area, that's also good. It doesn't have to a policy which resolves the whole housing crisis - that's not generally how things work. It's just helping.

It's not the politics of envy, and it's not ideological spite. It's not even socialism. It's fairness - ensuring everyone's basic needs are met.

Not necessarily. Some move from, say, Chesterfield or Sheffield where house prices are mostly lower.

I very much doubt a bakery in a small village of eg < 1000 would get the trade to survive without holiday visitors (be they renters or owners). In reality in pretty much every village I know the locals get their supplies from Tesco or similar, only using a village shop for the odd pint of milk or emergency supplies. Small shops simply cannot compete with the supermarket chains on price. Visitors will use the local shop for convenience and be less price sensitive on holiday.

I've watched quite a few village shops stutter and die over the last decade or so in villages of a lot more than a thousand which sustain local schools and active communities. Some convert to tea shop/cafe type places if in popular areas. These are villages with nowhere near 75% second home/holiday cottages. This pattern has been the case for decades now in villages and urban high streets - its not a consequence of second home ownership.

You're assuming best possible case (which never happens in finances) and partly arguing my point - it will go towards a deficit and not fix the fundamental issues in the county (bear in mind the budget expenditure for Cornwall is nearly £1.5billion on their approved budget).

I'm not arguing against extra CT. I'm arguing that its a bit of a fig leaf which won't make material difference to the county's employment and transport situation. Its good quality employment and transport which maintains communities, not higher CT which at best will be used to reduce deficits/provide basic services. Local people will still not be able to buy if they still don't have the jobs to sustain a mortgage.

I'm assuming a band C - my expectation would be that second homes would tend to be higher bands, so it'a a conservative estimate. And I'm not providing a fully-modelled, caveated forecast. I'm showing that it's not 'peanuts'.

Assume 75% of the income is received (some people have exemptions, some sell up etc). That's £22.5m, which covers the deficit. Keeps the council afloat. Avoids more and more cuts to services. Leaves the reserves intact for emergencies. Forecast overspends take up a huge anount and resources which could be spent on actually improving things.

Meanwhile the council continues with the work it is doing to find solutions to the problems - trying to create jobs, build more houses.

I don't think the CT alone will solve the problem, but it will make it easier rather than harder. And it is probably relatively cheap to implement.

even by out of area housing associations, usually in deals that involve housing local families in return for Cornwall taking some of their residents.

Have you got any evidence of this happening? Because I hear this mentioned sometimes, and as far as I know it's a myth.

And if you thought about it....why would HAs and councils offload their tenants to Cornwall, where property is quite expensive, when there are much cheaper areas of the UK?? I did read an article in the Guardian about some London boroughs putting pressure on prospective tenants to accept properties in Hull, but that's not quite the same thing, is it?

Agree 100%. The whole second home thing is a symptom of a far bigger problem, not the cause. In rural areas of Italy they were selling houses in deserted villages for £1 to try and encourage people back into rural areas, but people need well paid work.

When my friends were growing up in Cornwall they worked in banks, shops, garages, hairdressers, small local factories. There was still market gardening for holiday jobs. All the bank branches have shut now, lots of the shops are now charity shops, huge numbers of jobs have just gone and not been replaced, and there is a lot of competition for those that are left. Many local jobs are part time roles, often on a short contract and very low paid, and people need two or three jobs to get by and as you say, this makes it impossible to get a mortgage.

I'm showing that it's not 'peanuts'

But you are not showing any such thing - you are making assumptions without data. My own anecdotal assumption would be that most of these homes are C downward with relatively few above C.

That is based on (a) the frequent complaints that "incomers" snap up first time buyer properties and (b) my own observations of holiday homes tending to be the smaller cottages and apartments without the annual run costs and maintenance headaches of a larger family home and garden. Larger homes bought by outsiders tend to be bought by people planning to actually move into the area.

However lets pretend that this can bring in £20m (and I don't agree that implementation is cheap enough to be discountable) - that is around 1% of the expenditure budget. Its sticking plaster.

Meanwhile the council continues with the work it is doing to find solutions to the problems - trying to create jobs, build more houses.

Historically Cornwall councils track record on this has been pretty poor, especially considering the amount of EU investment a couple of decades back. As I said upthread - maybe the changing voting patterns will help that but its reputation as an old boys club wasn't earned for nothing. (Again not a unique problem to Cornwall, its an issue in many local areas, but voters who want change need to vote for it, not vote tribally for matey landowner who employed grandpa).

My concern is that this just becomes a massive displacement solution and in ten years time the next generation who can't get jobs or homes will be little better off as the root causes have not been addressed.

The Italian example was in the back of my mind as I've seen similar schemes discussed for UK villages where houses have been abandoned or are marketed for a few thousand pounds and still don't sell.

Ultimately unless a region addresses its work and transport options nothing will improve and the next generation will face the same challenges. This should have been the focus of rural councils back in the 80s when deregulation meant the loss of so many regular jobs, many with tied cottages (which are now mostly holiday cottages).

Instead it was all "tourism tourism" which is not a large provider of steady and well paid jobs. Consider this on top of the wider shifting job market as bank branches close, some industries moved abroad etc it was always going to be tough to manage. That said some areas seem to have managed less effectively than others.

Sorry didn't read your message properly. Council is not interested, or rather cannot afford to do anything. There are a few organisations like CLTs who do this sort of thing, and other housing associations. I cannot give you chapter and verse ln the economics of housebuilding, but It's simply not viable to have lots of small developments of 5 or 6 houses scattered around the place. No one can afford to build them. The only people who can are the big 6 and they won't build affordable homes, they will put up ultra expensive executive homes

Wandsworth, Camden and Hackney were mentioned by Sky News. Not sure about the other boroughs.

I'm not anti the higher council tax, I just don't believe the posters saying that second home owners come for 2 weeks, bring their own food with them and don't spend a penny locally.

I certainly can't find it in myself to feel sorry that second home owners are going to have to cough up more tax.

I would however like to see hefty taxes applied to land banking.

I would also be in favour of making foreign investors who buy up UK properties as an investment pay handsomely for the privilege. If they are rich enough to park their money here because they don't want to use the banks etc in their own country they can afford to give something to this country as compensation for taking potential homes away from the people who live here.

I wish they’d ban foreign buyers in the first place

my db wanted to buy in Thailand some years back and he couldn’t

At least those that buy for investment and leave the place empty. I wouldn't necessarily stop people who have jobs and intend to live here from buying.

I agree entirely. It is the swathes of empty dark flats which get my goat.

For me it's a good thing. We are short of housing in this country, so buying up additional houses should be taxed heavily and the money invested to build more.

Not foreigners specifically but foreigners who don't live and work in the UK. Those who buy just as an 'investment', whether foreign or permanent British expats, who don't come back after a certain period or rent out the house, should be taxed more.

They probably do now their council tax bill has doubled or tripled.

No, but you said "they keep coming back and asking for more leeway". Who is asking for more leeway? Your entire answer doesn't make sense! Who has put in.a planning application to develop these parcels of land?

ott. Homeless crisis isnt only about unaffordability. There’s people out there living in their cars etc because they are arseholes whose anti social behaviour has seen them chucked out from rental accommodation and their family homes and they deserve to be where they are !

I was so pleased to read a family member stand up on social media to ask community not to assist their family member who was living near a local bridge. They pointed out that person had a choice, but wouldn’t wind their neck in to get along with others, so was told to leave.

I agree, but sadly the council doesn’t, so they are being charged the second home council tax ‘penalty’ as if it were a home someone could live permanently in. Which is such a shame that the Council doesn’t differentiate.

on the other hand I can totally see why. I find St Ives when it is quiet absolutely stunning. Hate it full in August. But it is clearly very empty off season, and so many houses are dark and empty. It almost feels like an empty theme park.