The Generation Rent activist group claims holiday homes are eroding the supply of available properties in key tourist areas. 

It claims 80 per cent of the growth in holiday homes during and since the pandemic is concentrated in 25 local authorities. In these areas, 72,754 new homes were built or converted in 2019-22, but 20,803 or 29 per cent were lost by becoming commercial holiday lets or second homes.

In seven areas – including parts of the Lake District, North Yorkshire and Devon – the growth in holiday homes effectively cut new supply by more than half, and Generation Rent claims this is “making it harder for councils to accommodate their local populations affordably.”

Government consultations on registering holiday lets and requiring owners to have planning permission to let to tourists close tomorrow. Generation Rent is calling for powers for local authorities to license holiday lets and cap their numbers, and for the withdrawal of tax breaks, in order to reverse their recent proliferation.

It claims that in 2019-22, 682,235 new homes were added to England’s housing stock. Over the same period, there was an increase in the number of homes registered as second homes or commercial holiday lets of 26,043. That represents 4.0 per cent of the growth in housing stock nationally.

But it says the growth of the holiday home sector was highly concentrated: 80 per cent of the increase in the numbers of second homes and holiday lets happened in just 25 local authorities.

The growth in holiday homes in Copeland, Cumbria, was 407, or 96 per cent of the 426 homes added to the housing stock. 

Other holiday hotspots where the growth of holiday homes is undermining efforts to boost supply for locals are Torridge in Devon (63 per cent), South Lakeland in Cumbria (63 per cent), Scarborough (56 per cent), Richmondshire in  North Yorkshire (49 per cent) and North Norfolk (42 per cent).

Cornwall, where eight per cent of homes are second homes or holiday lets, fared slightly better with the growth in holiday homes equivalent to 27 per cent of new stock.

The government has proposed to set up registration schemes for tourist accommodation and to require owners of holiday lets to apply for planning permission. 

But this isn’t enough for Generation Rent which claims that existing holiday lets are set to get automatic permission, “which is likely to increase their value and so will make it difficult to bring them back into the residential sector.”

Dan Wilson Craw, the activist group’s acting director, says: “The unregulated and undertaxed holiday let sector is out of control. It has taken homes away from locals who grew up in holiday hotspots and people who want to work in the tourist industries, making these areas unsustainable. A large part of the solution to high rents is more housebuilding, but locals won’t see the benefits of this if houses continue to leak into the holiday homes sector.

“It is welcome that the government is looking at ways to regulate holiday lets, but there is a huge risk that the proposals will lock in the sector’s recent growth and make it harder to bring down rents by switching properties back into residential use.”