Second home owners are “gutting” rural communities, Nick Clegg said yesterday, as he revealed the Liberal Democrats are considering fresh taxes on holiday cottages to ensure locals are not priced out the market.
Out-of-town property owners are “filleting” local communities and leaving young people in rural communities unable to buy homes, the Deputy Prime Minister said.
The Coalition has already granted councils the power to charge the full rate of council tax on holiday homes, and the Liberal Democrats will “constantly look” at how they can go further, Mr Clegg told his monthly press conference.
A senior Liberal Democrat source said the party was considering council tax surcharges.
“The party has looked at very various options in the past, including what can be done in the planning and council tax systems. We will come forward with proposals in due course,” the source said.
Liberal Democrat councillors and MPs have called for further measures, including tax premiums on “townies”, in order to keep a lid on local property prices.
Tim Farron, the party president, represents Kendal in the Lake District while David Laws, Mr Clegg’s close ally in Cabinet, represents Yeovil in Somerset.
Under reforms to council tax in 2011, councils no longer have to give holiday homes a 50 per cent discount.
The only long term solution is further house-building in desirable parts of the country, the Deputy Prime Minister added.
Mr Clegg said: “You know we’ve changed the council tax treatment of second homes already. It’s a huge problem in parts of the south west, parts of the Lake District.
“We will constantly look at how we can make sure that people can of course invest in an area, that people who create a holiday home are not barred from doing so, but so we don’t have this problem of whole communities being filleted, gutted, with just no prospect of local youngsters finding a home they can call their own.
“One of the ways out of this is to make sure we build more homes on the scale we need.”
More than 165,000 Britons own a holiday home, according to the 2011 census. Of these, 23,000 have properties in Cornwall.
The area with the highest concentration of holiday homes is Gwynedd in North Wales. There are 121,874 usual residents and 7,784 holiday homeowners – meaning 64 “townies” for every 1,000 locals.
In North Norfolk, there are 4,842 holiday homeowners and 101,000 residents – a ratio of 48 holiday dwellers for every 1,000 locals.
Three areas have 45 holiday home owners for every 1,000 residents: South Lakeland in the Lake District, South Hams in South Devon and the Isles of Scilly.
Second home owners are often blamed for driving up property prices, leaving the offspring of locals unable to buy homes.
At the same time, because they are absent for much of the year, they are accused of turning communities in ghost towns outside the summer holidays. That can lead to local services, such as busses and libraries, being withdrawn.
The situation could be exacerbated thanks to the Government’s pension reforms, which will allow retirees to invest their entire pension pots in property rather than buy an annuity.
Andrew George, the Liberal Democrat MP for St Ives, has warned there is an “inexorable trend of turning our rural communities into the exclusive preserve of the better off”.
In the Cotswolds, home to David Cameron’s Witney constituency, four per cent of properties are owned by people from outside the area.
Paul Hodgkinson, a Liberal Democrat councillor and Parliamentary candidate, told the Liberal Democrat spring conference that average house prices are now £375,000, nearly twenty times the average local salary of £19,000.
“The Cotswolds is often seen as a playground for the rich and famous, but the reality is very different. The affordability gap is getting bigger and bigger,” he said.