Following its deal with Plaid Cymru, the Welsh Government has said it is committed to sorting out Wales' second homes crisis.
In certain parts of the country, the amount of second homes is causing real issues as the increased buying power of these types of purchasers is pushing up house prices, meaning many local people are unable to get on the property ladder. This has implications for local services and on the Welsh language.
To combat this, many local authorities have raised council tax on second homes, leading to some selling up. However, a North Wales Live report has shown this isn't necessarily helping local people. Critics have said that what was designed to tackle the county’s housing crisis was having unintended consequences, pushing up property prices, draining money from the local economy and changing visitor demographics for the worse.
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Some second homes on the market have been in family ownership for generations, and some have been sold by families with Welsh-speaking children. One “devastated” owner, a regular visitor to Llŷn Peninsula for 70 years, sold her second home in Abersoch last December after becoming saddled with rising costs and becoming disillusioned by growing numbers of what she described as rowdy holidaymakers with no roots in the community.
A Pwllheli businesswoman, who looks after second homes when their owners are away, said a double tragedy was now unfolding in holiday hotspots where local people had been priced out of the housing market. “Too many of my clients are now selling their second homes as they simply cannot justify the extortionate taxes,” said the woman, who asked not to be named. You can get more property news and other story updates by subscribing to our newsletters here.
“These homes aren’t going to locals but to buyers prepared to pay over the odds. These people are either looking to open holiday lets just as the staycation boom ends, or they are wealthy individuals who will use their second houses less often, leading to the closure of independent shops, bars and restaurants.”
In April, 2021, owners of second and empty homes in Gwynedd began paying a 100% premium on their council tax charges. From April 1, 2023, this could potentially rise to 300%, quadrupling council tax bills for affected owners. The measure is discretionary and it will be up to individual councils to judge how punitive the increases.
Costly to stay, painful to leave, sad to see so many Airbnbs
For Sue Hanning, a retired primary school teacher from the West Midlands, she could no longer justify monthly payments of £440 for the two-bedroom property she and her first husband bought in 1993. She sold up in December, so cutting ties with a village that went back seven decades: Sue, 70, has been visiting Abersoch since she was a child, her grandfather becoming good friends with the then harbourmaster and often staying in his house.
After divorcing, she was left with the Abersoch property and she said that, over the years, it became a place of sanctuary for herself and her immediate family. The house was only ever rented out to close friends.
Initially, Sue said she was charged half-rate council tax. When it rose to the full rate, she was happy to pay – even though the property was originally built as a summer holiday home and lacks central heating. A few years ago Gwynedd Council began charging a 50% premium and last year this increased to 100%, doubling her council tax. By next April she could be paying an eyewatering £900-a-month.
“I may as well climb to the top of a mountain and throw away my pension,” she said. “I want to leave my daughter something and be prepared for care home fees. It left me in profit but the property was never an investment – I even dropped the price so the buyers could afford their mortgage.”
Sue’s house, on the Cae Du estate, was in one of two blocks of six adjacent properties, once all second homes. One by one, they began to disappear: only two of the 12 now remain. They were replaced by holiday lets, bought and refurbished by investors who, according to Sue, needed to sweat their assets to recover their outlays. The result was a rapid churn of holidaymakers with little empathy for the village, she said. On one occasion, recalled Sue, a group arrived on the beach demanding to know where the pier was. It was farcical she said – but other incidents made her blood boil.
“One night the people opposite were rowdy and kept me awake until 4.30am,” she said. “They did not care about the area and they didn’t care how much noise they made. Once it was idyllic but it’s all changing now. All the locals say it’s so sad that second homes are being replaced by Airbnbs.”
Some changes were small but still annoying. Where once they were left empty over winter, residents’ bins are now filled by casual visitors. Meanwhile, bin collections have been switched from Saturdays to Wednesdays - Saturday collections were handier for second home owners on weekend visits.
Sue, who remarried and now lives in Staffordshire, twice upgraded her Abersoch kitchen and bathroom, insisting on local labour each time. Others don’t. “They hand the keys to a man in Manchester and tell them to get on with it,” she said. Her former holiday home is now an Airbnb.
Selling her beloved property was “painful”, she said. She said she loved the village and its community – and still does. “It’s hard whenever I see a Facebook post on Abersoch,” she said. “I decided it would be just too difficult for me to go back there this year. I was devastated when I realised I couldn’t afford to keep my home. I am not some rich millionaire. I am a retired primary school teacher who remortgaged my main home to buy my dream. My home in Abersoch was my sanctuary and safe place with memories of my holidays with my parents, grandfather and sister.”
Owners fleeing the area
Sue’s experiences chime with those of other home owners in the village. One couple, who raised their children as Welsh speakers in the village, have put their family home and holiday property on the market. Despite living in Abersoch for decades, they have been spooked by the Welsh Government’s changes to holiday let occupancy rules.
From April 1, 2023, properties must be rented at least 182 days each year. If they fail to reach this threshold, their owners will pay council tax rather than business rates – potentially with a 300% premium.
“They decided they couldn’t take the risk,” said the Pwllheli property manager. “If they miss the occupancy target by a single day, they could lose a significant chunk of their annual revenue. They have no option but to sell up and return to England.” Another of her clients is selling up and a third will make a decision this weekend. The latter lives locally and the family's two holiday lets have been handed down through the generations.
“They can’t face the hassle of trying to rent the properties out for so many nights just to meet the proposed council tax thresholds,” she said. Yet they face a dilemma: having invested heavily in upgrading their holiday lets, they are in negative equity until they recoup their outlay.
Another local agent reported three second home sales so far this year. Unlike Sue, all could afford the extra council taxes. But the agent said they chose to move away because they felt “bullied” by the county’s “anti-tourism” policies.
'Charity shops on the high street'
It’s estimated that a tenth of Gwynedd’s housing stock now comprises second homes and holiday lets. In some areas, the figure is over 50% – and rising. But while there is a clear need to tackle the problem, questions are being asked about the approaches being taken.
Critics believe that targeting second homes through council tax rises is driving up the number of unregulated holiday lets. It's also creating a new price spiral: by forcing owners to sell up, the policy is displacing long-established visitors with a new generation of well-heeled buyers able to afford properties that remain beyond the reach of local people.
These buyers, said the unnamed property manager, were more likely to “spend time on their yachts” than support local businesses. Fewer were families, she believed. “These people are not going to be popping to the newsagents or buying a bucket and spade for the beach,” she said. “The first to complain will be the locals when they see yet more charity shops on the high street.”
Alternative solutions are needed, visitors believe. One might be through the planning system, ring-fencing affordable new homes for local people with appropriate sell-on clauses, much like Section 106 agricultural ties. Yet there is a perception that Gwynedd Council has done too little to reinvest its council tax proceeds in local housing stocks.
On Facebook, one person said: “New houses need to be built by the council, only to be sold to Welsh people. In all the years I’ve been coming to Llanbedrog, only eight houses (I think) have been built.”
Another idea is to make greater use of the stock of empty and semi-derelict cottages. Empty homes already incur a council tax surcharge but too few were brought back into use because of a lack of local facilities, said the property manager.
“My mother lives in Snowdonia in an area with little infrastructure,” she said. "There’s no mobile phone or satellite coverage and BT is axing its analogue phone lines. If the council was to invest in infrastructure, and ease planning restrictions, it could bring multiple empty properties back into use – lots of local young people would jump at the chance. By doing this, it could actually revive many communities rather than biting the hand that feeds so many of us on the Llŷn.”
What a Gwynedd Council spokesperson said about the issue
A spokesperson for the council said: “Recent research shows that 60% of Gwynedd residents are priced out of the housing market, that the county has the highest percentage of second homes in Wales and amongst the highest number of long-term empty properties.
"As a council we are committed to tackling this unacceptable situation. That is why we introduced a 50% council tax premium on second homes and long-term empty properties in April, 2018, and subsequently raised this premium to 100% in April, 2021. Any further change in the rate of council tax premium would be a matter for consideration for the full council to decide upon.
"Our council tax premium policy is helping to deliver a range of projects in our £77 million Housing Action Plan. This plan includes various schemes to tackle the lack of affordable housing available for local people as well as the historic and current issues relating to high levels of empty properties and second homes.
"As part of this work, the council's cabinet has earmarked £5.4 million to purchase and renovate properties over the coming years so that they can be made available for local people to rent. We have recently contacted over a thousand empty property owners in Gwynedd to ascertain their future plans, with a view to purchasing them if possible.
"Alongside this, we are providing financial support to first time buyers to renovate their properties, making the most of the Welsh Government’s ‘Houses into Homes’ scheme which offers support to convert or renovate redundant buildings into homes, and numerous other schemes such as Homebuy.”
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