The second home council tax premium has “decimated” local property markets, with house prices falling and the number of homes for sale soaring.
The policy was supposed to make properties more affordable for those living there by encouraging second home owners to sell up. But sellers in tourist hotspots have told Telegraph Money that this isn’t working; they argue that properties being sold as a result of the changes aren’t suitable for first time buyers, and fewer are being bought by local residents….
….Properties popular as second homes are typically unsuitable for first time buyers or young families says Carol Peett, of buying agent West Wales Property Finders http://www.westwalespropertyfinders.co.uk
She says: “Often they are chocolate box cottages which look beautiful and are ideal for a few weeks’ holiday in Summer but in reality are cold, damp and dark in Winter. Or they have very little storage, no family friendly garden or no parking, or are in remote areas away from local amenities like shops, schools and workplaces”…..
….The reasoning that the second home tax was supposed to help young families buy homes in their local area is flawed, agrees Peett.
“Most second homes are far too expensive for young local families, even if prices drop. In our area of Wales most second homes cost over £500,000 and are never going to drop down to an affordable level. The average price for a property in Pembrokeshire is £245,000 which is the level locals can afford”.
In Wales councils were given the power to increase second home owners’ bills by as much as 3000pc in 2023.
In the pretty harbour town of Tenby Pembrokeshire, second home owners pay a council tax premium of 150pc. It was set at 200 pc in April 2024 but, only six months later, the council dropped it back to 150pc due to “the devastating consequences on the local economy” Peett says.
Offloading second home owners now flood the market. Tenby’s current average sale price of £275,068 is 21pc down on the previous year, according to Rightmove…..
The Daily Telegraph – Saturday, 2nd August 2025 – https://www.telegraph.co.uk/money/property/second-homes/locals-dont-want-to-buy-second-homes-like-ours/?msockid=0b48347b23f76761079f224c224c66b0
