Good sign of campaign success on second homes

Posted on: 7th December 2022

Fellow housing justice campaigners and I can celebrate a campaign success – a boost for those who have been fighting to put first homes before second homes. It’s taken decades and won’t happen for another two years – but the prospects of success look encouraging.

The proliferation of second homes, holiday lets and Airbnbs have come at a significant cost to local communities, families evicted to make way for them, taxpayers who’ve been forced to subsidise them and a housing market which now functions more to serve property investors than it does to meet housing need.

Over twenty years ago I celebrated the success of a campaign I’d led in Parliament to reverse the then Conservative policy of spending hundreds of millions subsidising second home owners through the then 50% council tax discount.

I also campaigned for Labour and then Conservative planning & housing ministers to introduce planning measures to require all second homes to need planning permission to convert from ‘permanent’ to ‘non-permanent’ accommodation. Labour ministers had sympathy but ran out of time. Conservatives laughed in my face.

Then in 2012 came the introduction by the Conservatives of a brand-new tax loophole to benefit second home owners. Thousands flipped their properties from council tax to business rates, applied for a new rate relief and paid nothing. Taxpayers picked up the tab!

The injustice was evident. I campaigned again. To begin, no one listened. But eventually the penny dropped. Those in the media I was trying to take notice, began to understand. But many couldn’t quite believe it.

The realisation grew stronger. Others joined the campaign. Then the public astonishment grew. Even Conservative MPs and Ministers felt uncomfortable when presented with the shameful facts; that thousands of owners of second homes in places like Cornwall paid neither council tax or business rates, while the rest of us subsidised them. This cost about £14m each year in Cornwall alone. Cornwall Council recently confirmed that holiday lets in Cornwall have cost £142.6 million in tax relief since I first blew the whistle on this a decade ago. The Council also now confirmed to me that holiday lets received another £242.2m in Covid aid. That’s £384.8 million of taxpayers’ money which should be invested in first homes, given to wealthy second homers in the last decade in Cornwall alone!

I’m relieved that, because of this campaigning, the Conservatives have been shamed into finally doing something about it. Reluctant and slow, but credit should be given nevertheless.

They’re accepting some of the proposals I’ve campaigned for: new regulations which make it less easy to claim the tax rebate; provisions to double council tax; and, crucially in my view, adopting the planning policy I described above. There’s still more to do and it needs to be speeded up. I continue to have concern about much of the detail. But the basic building blocks are there. And credit should be given to Cornwall’s housing portfolio holder, Olly Monk who is doing a good job.