x
By using this website, you agree to our use of cookies to enhance your experience.
Graham Awards

TODAY'S OTHER NEWS

Labour war on holiday lets - UK-wide licensing scheme proposed

Labour wants to bring in a UK-wide licensing system for holiday lets to preserve the “spirit” of costal and rural communities.

The announcement has been made by Shadow housing secretary Lisa Nandy who says her party’s idea would allow areas to “to reap the rewards of thriving tourism” while avoiding “ghost towns” in autumn and winter outside of tourist seasons.

The idea is strikingly similar to that recently announced for Wales, which has a devolved Labour government.

Advertisement

“With a stronger licensing system, communities will be able to reap the rewards of thriving tourism but end the scourge of communities becoming ghost towns when holidays end and people are priced out of their own neighbourhoods just for homes to stand empty for months” says Nandy.

“By trusting the community, working with the community, we can find the right balance to bring growth and jobs and income, but protect the spirit and the fabric of a community that matters so much.”

Nandy also proposes a beefed up community right to buy scheme, to enable local people to take control of assets such as live music venues and football clubs that come up for sale or fall into disrepair. Under the proposals, they would be given first refusal on assets of community value, including the right to buy them without competition. 

Communities would also have the right to force a sale of land or buildings that have fallen into a state of significant disrepair, and they will be given 12 months to raise funds - the current system allows only six months, and has been used only infrequently.

In Wales, councils will shortly be able to control numbers of second homes and holiday lets with a licensing scheme for home owners and landlords who want to operate short lets, such as Airbnbs.

First Minister Mark Drakeford and nationalist party Plaid Cymru leader Adam Price made the announcement as made as part of their co-operation agreement to run the Welsh Government.

There will be three new classes of property in the Welsh planning system: a primary home, second home and short-term holiday accommodation. Councils will then be able to make amendments to the planning system to require planning permission for change of use from one class to another.

There are also powers to be given to councils to apply for higher Land Transaction Tax (the Welsh version of stamp duty) on second homes and short lets.

It has already been agreed that Welsh councils can charge up to a 300 per cent premium on council tax on homes that aren’t occupied all year round 

Drakeford, who leads the Labour Party in Wales, says that while tourism is "vital" to the Welsh economy, a glut of holiday properties and second homes damages communities and prices people out of local housing markets.

He says: "We will work with local authorities to develop a national framework, so they can put to us, proposals for increased land transaction rates for second homes and holiday lets, which they can then apply to their local areas. The finance minister has written to the local authorities today, so that work can begin on those proposals. 

"Some of these measures are about making access to the market fairer. Others are about a better balance between second homes and holiday lets in local communities.” 

Last month, the Westminster government announced a new study to probe the impact of holiday and short lets on communities, including specifically on coastal area. The Westminster government is considering health and safety checks on premises and a self-certification scheme for hosts. Meanwhile in Scotland, all Airbnb-style short lets will need a licence by July 2024.

Want to comment on this story? If so...if any post is considered to victimise, harass, degrade or intimidate an individual or group of individuals on any basis, then the post may be deleted and the individual immediately banned from posting in future.

  • George Dawes

    Lisa Nandy makes Boris look like Einstein

  • icon

    The idea of classifying properties as a primary home, second home and short-term holiday accommodation makes sense as long as traditional BTL is classed as a primary home. Classification needs to be based on the occupier not the owner where there is a choice.

    Primary homes are a basic essential.
    Second homes and short-term holiday accommodation are luxuries.

    The current housing crisis is largely because the luxury housing classes are given far more favourable tax treatment while long term traditional BTL is taxed to a far higher extent than any other industry.
    An extra 3% SDLT when we buy, our tax band determined on turnover not profit thereby losing any younger landlords their Child Benefit, a tiny tax credit towards our finance costs unlike every other industry where finance is a fully deductible cost before determining the taxable profit, a higher rate of CGT than any other asset if we sell.
    Then the Rental Reforms White paper wanting to force us to allow pets and messing about with the eviction procedures.

    If traditional BTL landlords were treated as proper businesses with clear, consistent ideas of fair and proper behaviour relaxing to both landlord and tenant there wouldn't be a rental crisis.
    The problem with licensing schemes is the unintended consequences that always become apparent after a period of time. Also the lack of flexibility to accommodate an ever evolving housing need.

    icon

    I’m with you on this. I have BTL’s, short let’s in City’s and a holiday let in Wales. I have no problem in sensible legislation. There is voluntary legislation now which is just sensible and I abide by all the recommendations and it pays dividends on my returns. I think all property that is not a personally owned PPR should be treated as a proper business and have minimum standard expectations. I even wouldn’t mind paying National Insurance on my profits. But I strenuously object to S24 which is punitive tax that is full of unintended consequences. I’m only in shorts let business of S24 and would happily return some of my properties to BTL if it was removed. If they implemented S24 on short let’s too though I definitely wouldn’t return them. As a business community we cannot expect to reject every proposal put forward. Engagement is the way forward, although sadly the Government doesn’t appear interested in doing that at all … but it takes two to tango! And if it will take a Labour government for that to happen then count me in!

     
    icon

    My little cottage is not a luxury to me - it’s my only income after working full time all of my life and very hard too.

    I was born in and have lived all of my life in a National Park and there are easy solutions to this issue. It’s not rocket science.
    Policy !!!!
    Build more houses or change policy on existing building conversions. Stop allowing those who are either anti farming (for food- or just envious of multi generational permanent residents) from sitting on committees and being part of a decision process actively preventing progress on local housing issues.
    Current much welcomed proposed policy changes may help to prevent previous policy/individual committee members bias against using existing buildings for conversion.
    I know of applications to convert existing family owned buildings into housing for permanent homes for young family members working in the business being turned down in favour of holiday lets. This is outrageous.

    Secondly, there is no monitoring or policing of how holiday let’s are used.
    When we eventually completed the renovation of my cottage during Covid, I contacted my local council to arrange to pay for the services covered under council tax to be used by my cottage guests, waste disposal, police, fire, roads etc. I was advised that there was nothing to pay until I reached the income threshold. This set me thinking and having a very good knowledge of the holiday accommodation business I know that many so called holiday let’s are still being used by the owners of them as second homes too. It’s a win win situation. They don’t let it all year round saving slots for themselves family and friends and in doing this, don’t reach the threshold for paying their dues so do not pay any rates for any services. I was staggered by this. There is no wonder we permanent residents have some of the highest council tax in the country.

    Classify houses as A Permanent paying council tax, B second homes only used by owners and immediate family paying enhanced rates of council tax AND monitored closely and then
    C Holiday let’s where a relevant rate council tax for the property is paid and income - expense for the business is assessed and taxed accordingly and the income from this be ringfenced to create more local occupancy housing.
    Cutting off my nose to spite my face maybe, but it might help my grandchildren to be able to live close to me and to continue to work in the businesses that are seriously struggling to keep open because of staff shortages because of lack of housing.

     
  • icon

    I don't think it is a good idea to classify properties as primary home, second home and short term holiday accommodation if the aim is to double council tax on second homes. People used to be able to buy a holiday home for their own use and pay half the council tax, now there is no discount. The new proposals seem like a Communist agenda to me.

    icon

    Politics of envy - typical of champagne socialists.

     
    icon

    That's what I thought Robert.

     
  • icon

    Well as we operate in Wales I can say that taking policy ideas from Welsh Labour and Plaid is like getting Jeffrey Epstein to run a girls school.
    In 20 years of devolved power, we have more homelessness, our NHS has the longest waiting lists, rents are climbing so fast tenants are sleeping on sofas of other tenants, businesses investment is the lowest ever and we have a blanket 20mph. Lisa Nandy needs a slap to wake her up

  • icon

    Ellie- I tend to agree with Jo, given the crisis in housing any responsible government has to do something, yes I understand that the less responsible governments of the past have got us where we are, but we have to deal with today’s issues. I have seen with my own eyes tenants being evicted to turn their home into another holiday let, again I do understand how a market economy works, but that cannot continue. All governments have a wide responsibility to the total health of the country, housing being one of the main 3 (food/energy).

    icon

    Simon

    Your understanding of the market economy should lead you to conclude that only a small percentage of BTL properties could be successfully moved over to short term rentals due to supply and demand limiting the number required.

    The key issue, which is not appreciated by those who advocate punishing long term rental landlords, is that those BTL properties most likely to become successful short term rental properties are the best properties in the most desirable areas, thus reducing the quality of properties remaining in the long term rental market.

    Another unintended consequence?

     
  • icon

    Simon - the holiday let is different, in my opinion, from a second home.

    icon

    Also a consequence of double taxation on second homes may be the requirement for landlords to pay double council tax during an empty period between tenants. Landlords used to be entitled to a 50% discount, now they pay 100%. That could change to 200% or more.

     
    icon

    Ellie - holiday lets and second homes are different but they are both luxuries that prevent some of those properties from being used as a primary residence.
    Some holiday lets and second homes will be purpose built holiday accommodation on holiday developments and have got planning restrictions preventing permanent occupation. They are being used for their intended purpose and should be taxed accordingly.
    It's the ones that were built as primary homes and are now used as second homes or holiday lets that are really contentious. Taxing them more favourably than other types of housing is just stoking the housing crisis.

     
    icon

    Jo

    Many second homes are also holiday lets.

    I have a really nice second home which I used to let out as a holiday let in summer and also on a six month let over winter. However when the SNP banned fixed term tenancies in December 2017, I stopped the winter longer term rentals and now get off peak rentals that earn me more than the previous winter rentals but the SNP have reduced the availability of winter rentals by their misguided dogma which the Tories and Labour now want to copy

     
    icon

    I agree Ellie, but the two occasions I witnessed tenants being evicted were due to turning them into Holiday Lettings, not to become a 2nd home for the family. If a holiday spot were left to regulate themselves then what is stopping everyone with a BTL doing the same, literally everyone? The answer of course is nothing, you would then have not a single dwelling to rent as a permanent home. Taking a wider view, that would be bad for society as a whole.

     
    icon

    Hi Jo,

    Sorry for the delay in replying. I was out at a property cementing two pipes together.

    Second homes are not taxed more favourably. You have to pay 100% council tax and you use far fewer facilities than permanent residents.

    Having to pay 100% council tax between tenancies is also quite onerous, because sometimes repairs and improvements can take some time.

    You do a good job promoting left-wing policy. It is just not a philosophy that I currently share, as I have been paying 97% of my income in tax - inheritance tax, income tax and council tax.

    I have been living on fresh air.

    I favour lower taxation and less regulation of property. It has already shifted too far to the Left in my experience.

     
    icon

    Hi Simon,

    There is a great deal of work attached to holiday letting. I don't think most people would want to be bothered.

     
    icon

    I disagree in many cases Ellie - see my comment to Jo Westlakes post - I know that many short term holiday lettings are also used as second homes unmonitored for much of the year keeping the income earned under the threshold for paying for services which shouldn’t happen.

     
  • icon

    The problem is unconstitutional immigration which the politicians want to fund by taxing the indigenous population.

  • George Dawes

    They’re puppets following orders

    Hopefully people wake up before it’s too late …

  • icon

    The second home situation has been going for many years and many young people have been forced to live elsewhere because the homes in their villages and small towns have been purchased by wealthier people. Nothing significant has been done about this until now because there are fewer homes for people to live in. This practice has to stop and allow communities to continue to flourish. Secong home owners have got very comfortable with set up but unfortunately needs must and councils have been loosing income because of only charging half CTax and we need to have people housed. So firstly occupancy categorisation needs to be established to be taxed accordingly. We need to take housing in our rural areas more seriously. Stopping the practice of turning primary homes into second homes or holiday lets is a must and I don't often agree with Labour but licensing service accommodation is also necessary because there's no regulation to protect the customer at the moment.

    icon

    You're years out of date!

    The second home discount was removed long ago despite second home owners making much fewer use of local authority services, usually only bin collection and then only for a smaller part of the year.

    I bought a derelict cottage which locals ignored for years and used local tradesmen to bring it back up to a high standard.

    Since then that property has put hundreds of thousands of revenue into the local economy whereas it was doing no good for anyone before.

    There are loads of derelict properties still around but people ignore them because they are not exactly where they want to live.

    People want everything handed on a plate but also hate to see others prosper through their own efforts and initiative.

     
    icon

    Couldn't agree more Robert.

    You sound as though you did a great job renovating that cottage, and have contributed greatly to the local community.

     
  • icon

    Who are you reimer ? Your obviously looking to profit from the politics of property, either a lawyer or politician, probably both. The problem is open borders, whereby invaders are treated like conquering heroes.

    icon

    The problem is that second homes deprive 'local' inhabitants the opportunity to live in the communities they were brought up. Likewise turning homes in to holiday lets does the same thing. Most of the 'conquering heroes' live in large towns and cities. I think you are way off the mark with your comments. The challenges not enough homes and we need to deal with it. This initiative is trying to protect rural communities and make house prices affordable in this areas.

     
  • icon

    Wales is now run by communists who want the English to fund their new Jerusalem. And use an aspect of racism to do it ! Frankly the economy is collapsing.

  • icon

    Ellie - I've never been described as promoting left-wing policy before.

    Holiday lets that are let for the prerequisite number of nights pay business rates instead of Council Tax and aren't subject to Section 24. They also aren't always subject to the same safety standards as hotels and holiday parks.

    For many years second homes paid reduced Council Tax.

    It can be argued that holiday lets boost tourism and second home owners employ local tradespeople. In some cases that may be true but in a lot it isn't.
    It can also be argued second homes are only occupied for a few weeks a year and cause communities to die. Not enough children to keep the local school open, not enough year round trade for the pub or village shop to remain in business. That will certainly be true in some areas. It's not a one size fits all problem.

    The simple fact is the current tax policies massively disadvantage traditional BTL landlords and in the process disadvantage standard tenants.

    I'm not a fan of envy politics. If people can afford a second home for their own personal use good luck to them. But don't complain about paying full Council tax on what to most people is a luxury that they can only dream of owning.

    icon

    I have been talking about council tax and second homes, not holiday lets. I have already said that.

    Whether one has the right to complain about the amount of council tax paid, depends on if you think council tax should reflect what you use locally. If you use virtually no council services, then you would legitimately and understandably not be pleased at having to pay thousands of pounds in council tax.

    At one point is was thought fair to charge second home owners 50% council tax and to charge landlords 50% council tax between tenancies.

    Then it was decided that second home owners should pay 100% council tax and landlords should pay 100% council tax between tenancies.

    Now it may be going to be the case that second home owners pay 200% council tax and landlords are expected to pay 200% council tax for empty periods. That is very punitive taxation.

    That, in my eyes, is also increasingly left wing local taxation - and could be combined with a policy of compulsory purchase.

    I visited the Soviet Union with an open mind when I was younger, and didn't like it one bit there because of the lack of freedoms. Most second homes had been nationalised following the Revolution, and the majority of people had very cramped accommodation - whole families sometimes in one room. However, Communist Party functionaries often had dachas or second homes in the countryside given to them.

     
    icon

    Comrades Corbyn and McDonnell still follow their heroes' example with several homes. At least they were thwarted in adding No 10 and No 11 to their portfolios!

     
    icon

    Very good Robert! So apt!

     
  • icon

    I've listened to the self interest groups enough. it's to do with fairness and as comfortable as it may be to have a second home which has been around for many years it doesn't make it a right. The young people who have to move because they are priced out of the market aren't quite so comfortable as second home owners. This now being addressed. Rural schools have closed by the bucketful because the number of children are diminshing. The consequence is that those who still live in the coutryside now have to be bused miles away and have no association with the community where they go to school. I can understand the wake up call after of these years of moving people out of their natural habitat so that those well off to buy a second home can go there a few weeks in the year. It happens with more affluent people buying their holdiay home abroad the locals get upset by the invading foreigners ruining their villages and small towns. Building a home where no house existed is one thing but outbidding a local just to spend a few weeks there every year is a luxury, but to a local a place to live. It's nothing to do with left wing politics I've never voted for them but I do a feel a sense on injustice on this issue.

  • icon

    Stephen my friend how does traditional Landlords letting out property affect first time Buyers as I understand it to avail of the Government Schemes they’ll have to buy New Build that will be from Developers high rise over priced Flats from the Governments mates creating unfair market place.
    I have built some of my own again if I let those properties I will not be use any stock available to first time buyers because if I didn’t put them there they wouldn’t be available to anyone. I think you have been listening to the wrong people while I agree with you what they are doing will reduce prices (Collapse the Market). The first time buyers that have bought are the unlucky ones saddled with over priced Flats and then hit with increased interest rates, if they try to sell they’ll be taking a hit plus it then will be a second hand property.

    icon

    Very well put and argued, Michael.

     
  • icon

    Stephen Reimer, l don't believe your crocodile tears. The problem is open borders and massive immigration. I think you profit from these situations, who and what are you ? (It wasn't very long ago that their was surfeit of social housing) Further a lot of social housing has been lost to Anti social behaviour.

    icon

    I tell you what I'm not everything you want to paint. Some people have scruples and as for your barbed comments it's obvious you want to continue well conintue if you want but this site is meant to be about an honest discussio which it why I'm reporting you.

     
    icon

    Sorry Steve but reporting for what ? please explain

     
  • icon

    In tourist areas, where property prices have risen and first time buyers can't afford to buy because investors are buying second homes. People who say these investors are being selfish, surely the local sellers are being just as selfish for accepting the higher price from an investor, rather then a lower price from a local? If the property prices are so much higher, then the parents can remortgage to help their children purchase property. There are pros and cons. If the investors did not come in then the property prices would be lower, but nobody would want to live there and there would be fewer jobs available. If there was less regulations then market forces would balance things out.

    icon

    Totally agree John. In some areas the former local authority houses, bought at a huge discount by sitting tenants, are sold on by those same former tenants (or their descendants) to the highest bidder. i doubt anyone would take a lower offer from a local but the seller is never vilified, only the buyer.

     
  • icon

    I think removing Section 21 is Nationalisation, or worse to be involved at all. Why and for what to be everyone else’s fool and banded a Criminal, while supplying the property and paying taxes to keep them.

    icon

    I know, it is all quite amazing, Michael. I know only too well how much work people like you do and how much tax that landlords pay. I have recently paid over a million pounds to HMRC. I wonder how much tax the activists pay and how much real hard work they ever do. Do they actually contribute anything of any value? They certainly do harm by discouraging investment in property.

    It does make you want to get out of the business, as there is no gratitude for all the tax paid and the unpaid work involved.

     
  • icon

    Stephen my friend good for you report away. I am sick of the Regulatory dishonesty / Section 21. Section 24. Licensing Scheme’s. that applies to some Sections of the Community and not to others do you think that’s fair. Best wishes have a good weekend

  • icon

    If the government stopped treating decent landlords like villains and bad tenants like angels then BTL would thrive. I run holiday flats for one reason alone: I will never have tenants in the UK! I used to be a very good landlord until I had a tenant from hell who was supported be the authorities in everything he did.

icon

Please login to comment

MovePal MovePal MovePal
sign up