A tourism boss has defended homes used as holiday lets and called for recognition of"the economic value of the industries that support an awful lot of people".
The Senedd's local government and housing committee is carrying out an investigation into second homes and took evidence on Wednesday, February 9, from tourism bosses. The Welsh Government has identified second homes as a problem and is planning to test 'radical' ideas to address it in the Llyn Peninsula.
The second home crisis is particularly acute in areas of Wales where there are fears the demand for second homes is pricing people out of their own communities and undermining Welsh language communities. You can read its impact on Anglesey here.
UK Hospitality's executive director for Wales, David Chapman said second homes needed to be looked at as part of the wider economy. He called for "holistic solutions" that recognised "the economic value of the industries that support an awful lot of people in the communities which are being discussed while making it easier for those local people to be able to buy houses and live in that area because they're an essential part, clearly, of our industry."
He said that raises contradictions and it is a case of "weighing up solutions".
Plaid MS Mabon ap Gwynfor, who represents Dwyfor Meirionydd, said there seemed to be a difference between commercial lets and short term lets. He said people are buying up "streets, literally" being lost from the local market in Abersoch, Aberdovey, Criccieth or Dolegellau, so the "lived experience is different to the theory. It's not someone facing a problem in terms of cost of living but people who already have enough money to buy these as investments for Airbnb".
Here's some of the things we learnt in the committee:
It's not clear what Welsh Government is trying to do
Sam Rees, Senior Public Affairs Officer for RICS said the Welsh Government's plans aren't "as clear as we'd like" and referred to a report by Dr Simon Brooks of Swansea University.
He said: "Are we looking at the wider economic and tourism industry in Wales or, looking at Dr Brooks' report are we reading it to be a deterrent on second homes and lets or is it about supporting communities?
"We've struggled to understand exactly what the Welsh Government wants to get out of this investigation," he said.
Shomik Panda, Director General of the UK Short Term Accommodation Association said: "Our understanding is the Welsh Government's main aim is to stabilise the number of second homes and reduce them over time, and Welsh Government wants to introduce local flexibility into policies.
"But we think also that the Welsh Government needs to be a bit clearer over what it wants to achieve with respect to second homes and holiday lets, the two issues are quite separate and shouldn't be confused. Taking punitive steps against short term lets isn't going to reduce the number of second homes but it could deprive local communities of tourism related income. We don't feel a diminution in supply of holiday lets would be beneficial to the Welsh economy."
The industry wants policymakers to accept a difference between casual lets and second homes
Suzy Davies, representing the Wales Tourism Alliance, said there is a "conflation" between casual lets and second homes and the "external narrative that goes around that".
She said: "Tourism is one of our major industries and there's been a level of damage in some communities where businesses have been conflated with casual letters which is to detriment of our residents in the community who naturally resent this and bona fide self catering businesses who are being dragged into the same perception as the casual letting activity which isn't regulated and there's no quality control".
The industry says there is no definition of a second home
David Chapman, Executive Director for Wales, UK Hospitality said: "You can't find at this stage, a definition of second homes. Dr Brookes couldn't do that and that's integral to this."
Mr Panda said his organisation believed that homes let out for more than 140 nights a year should be classed as a business, and those rented for less than that are a home and should not be differentiated as second or primary.
He said there is a need for commercial short letting in tourist areas, there's a need for "amateur short letting to make sure homes are being used efficiently so you're not having to build more and more just to keep up with demand". "All these cases we believe should be allowed to exist," he said.
Mrs Davies said WTA has a different outlook and says they don't consider commercial business short term lets are the issue, it's the "new surge in casual domestic properties which we think is putting the pressure on these communities".
She said a distinction needs to be made between those in terms of standards and knowing where those businesses are. She said it was difficult to make the case that communities are "swamped by commercial lets which provide long-term benefits to communities and this kind of sporadic unregulated markets which is where the growth has been".
The industry says that policies can't be 'one size fits all' across Wales
Daryl Mcintosh, Policy Manager for Propertymark said that any policy cannot be "one size fits all".
"There has to be a framework starting with the government and then local authorities being allocated powers. I think everyone realises it's not a one size fits all throughout the country. You can't have a national policy and there needs to be some flexibility. Enforcement also is a must and resources would have to be allocated to local authorities to carry out enforcement when regulations are introduced. Property standards should be equal through all property types."
Mr Panda said that in Scotland each council can have different enforcement and fees, and it's difficult for users and hosts making the market vary between different places. He said a national guidance document with national government holding councils to account was "quite important".
The industry says higher taxes won't solve the problem
Mr Rees said: "What is the point of taxation, we're looking at this from a number of ways. Is this to disincentive second home owners, to disincentive holiday let managers, is it an extra income generator for local authorities to invest back into the communities and if so, where is hat money going? When we're talking about second home owners and holiday let owners and their demographics, we're talking about above average levels of disposable income so paying 100% more council tax or higher rates of transaction tax or removing business rate relief, you've got think what is the impact of it? Being honest I don't think it's going to disincentivise second home owners. What is might do is shut out a few but those homes will go to second home owners with an even higher level of disposable income."
There are also worries about creating a new class of "holiday property" separate to residential
Asked about whether there are benefits to classifying a property as a holiday let in its own category. Mr Mcintosh said: "The unintended consequences you could have, if you have a property with a class use and its for that class use only, if someone is trying to market that property can it only be marketed for someone else who is looking for that use, maybe in five or 10 years down the line when it's not so popular the property may be sitting there for some time."
He also questioned if you were restricting the ability to get a mortgage on such a property.
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