The surge in holiday homes during and after the pandemic is wreaking havoc on available properties in key tourist destinations, claims Generation Rent, the prominent activist group.
According to their findings, a staggering 80 percent of the growth in holiday homes is concentrated within 25 local authorities. Shockingly, in these areas, a total of 72,754 new homes were constructed or converted between 2019 and 2022, but a significant chunk, 20,803 homes or 29 percent, vanished due to their conversion into commercial holiday rentals or second homes.
The situation is particularly dire in seven regions, including sections of the Lake District, North Yorkshire, and Devon, where the proliferation of holiday homes has effectively slashed the new housing supply by more than half. Generation Rent argues that this trend is “creating obstacles for councils in their efforts to provide affordable accommodation for local residents.”
Government consultations on holiday let registration and the requirement for owners to obtain planning permission for tourist rentals are set to conclude tomorrow. In response, Generation Rent is demanding that local authorities be granted powers to license holiday lets and impose caps on their numbers. Additionally, they are calling for the removal of tax breaks to reverse the recent surge in holiday home ownership.
The activist group highlights that, between 2019 and 2022, England witnessed the addition of 682,235 new homes to its housing stock. However, over the same period, the number of homes registered as second homes or commercial holiday lets saw an increase of 26,043. This accounts for a significant 4.0 percent of the national growth in housing stock.
More worryingly, the growth of the holiday home sector was heavily concentrated, with 80 percent of the surge occurring in just 25 local authorities.
For instance, in Copeland, Cumbria, the number of holiday homes grew by 407, accounting for a staggering 96 percent of the 426 new homes added to the housing stock.
Other popular holiday destinations experiencing a detrimental impact on the local housing supply include Torridge in Devon (63 percent), South Lakeland in Cumbria (63 percent), Scarborough (56 percent), Richmondshire in North Yorkshire (49 percent), and North Norfolk (42 percent).
Cornwall, where 8 percent of homes are second homes or holiday rentals, fared slightly better, with the growth in holiday homes representing 27 percent of new housing stock.
The government has proposed the establishment of registration schemes for tourist accommodation and the mandatory requirement for holiday let owners to obtain planning permission.
However, Generation Rent argues that these measures are insufficient, claiming that existing holiday lets are set to receive automatic permission, “which is likely to increase their value and make it difficult to convert them back into residential properties.”
Dan Wilson Craw, the acting director of Generation Rent, voiced his concerns, stating, “The unregulated and undertaxed holiday let sector is spiraling out of control. It is snatching away homes from local residents who grew up in popular holiday spots and people seeking employment in the tourism industry, rendering these areas unsustainable. While increased housing construction is a significant part of the solution to high rents, local communities won’t reap the benefits if houses continue to flow into the holiday homes sector.”
He further added, “It is encouraging that the government is exploring ways to regulate holiday lets, but there is a significant risk that the proposed measures will perpetuate the recent growth in this sector and make it even harder to lower rents by converting properties back into residential use.”