Acorn’s Group Planning Director, Duncan Powell has responded to the news that the Pembrokeshire second home council tax premium has been reduced to 150% and why it’s positive news for tourism.
“The recent decision by Pembrokeshire Council to reduce its Council Tax Premium on second homes has been warmly welcomed by the Welsh tourism industry and should be carefully considered by other councils in England and Wales that are contemplating similar measures.
The second home/Airbnb debate has been on the minds of Authorities in desirable tourist areas for many years. Cornwall, The Cotswolds, Devon and so on have all been the subject of discussion. However, the so-called negative impact of second homes hasn’t really been quantified, other than numbers of dwellings in a given area. This is hardly a measure of their role in the local economy, and crucially doesn’t capture the uplift in tourism spend that they bring.
The way people spend their holidays in the UK has changed significantly since the boom of the 50’s and 60’s in terms of large ‘bucket and spade’ coaching holidays. During this period (and indeed up until the 90’s), a huge number of large low budget hotels accommodated many visitors annually. Over time this changed – people wanted higher quality accommodation and more flexibility. Many hotels were redeveloped into dwellings, and many of these dwellings were purchased as second homes or holiday lets.
This leads to the first misconception: that second homes and holiday lets remove available housing stock. In reality, many of these properties have replaced traditional tourist accommodation.
The second misconception is that package holiday hotels boosted the local economy, but with these types of holiday the spend is generally isolated to the hotels themselves, they would have done very little for the local economy. However a typical second homeowner in, say, a coastal village will spend considerable money in cafes, restaurants, activity centres, visitor attractions, leisure facilities and so on, bringing not only greater spend, but a greater spread of spend and thus encouraging diversification of the tourist economy.
Admittedly, the rise in Airbnb’s in the place of traditional rental stock is potentially having more of an impact, with many of these springing up during Covid. However, the bulk of these are short term lets rather than second homes, and thus of irrelevance to changes in Council Tax premiums, and arguably in their contribution to wider visitor spend.
At Acorn we have a broad range of projects, and second homes form a key part of it. One of our projects in Bude has an extensive mix, with high value sea facing detached ‘grand designs’ houses that may well be second homes, through to discounted open market affordable dwellings restricted to local people. It replaces a derelict hotel and the use of some of the 27 homes for second homes or holiday lets will contribute to the local economy, and it would be a shame if this were impacted. We therefore hope that council’s with aspirations on raising revenues from second homes see the impact it is having in Pembrokeshire (along with the Welsh Government’s 182-day tourism rule that is being reviewed because of its negative impact) and act accordingly.
In my view, the best way to address local housing challenges isn’t to focus on complaining about the negative effects of holiday homes—which, after all, contribute to the local economy. Instead, the real solution lies in building affordable housing in sustainable areas. I’m hopeful that the Labour Party, with its plans to cut planning delays and encourage home construction, will tackle this issue effectively.“
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