House prices in a county where the council has aggressively penalised anyone buying or owning a second home have fallen by over 12% in one year.
Gwynedd council has introduced a requirement for people to turn residential properties into holiday lets or second homes, and it’s one of a number of Welsh councils to impose a 150% council tax premium on such properties.
The fall is the largest by some margin recorded by the Principality Building Society, which has reported price movements in the final quarter of 2024.
This contrasts with the all-Wales picture where average house prices have remained broadly flat year-on-year and a typical home costs £233,194., according to the building society.
The council claims its controversial penalties try to ease the shortage of housing for local people.
North Wales estate agent Dafydd Hardy described the housing market in Gwynedd as “mixed”, with local interventions on second homes leading to “more properties coming on to the market”.
Last autumn Gwynedd council started a new regime using so-called Article 4 Direction powers. This requires owners to obtain planning permission before changing the use of a main home into a second home or short-term holiday accommodation.
A spokesperson at the time said the council “wants to ensure that local people able to access suitable and affordable housing locally – that is key to securing the future of our communities.”
They continued: “Unfortunately, research shows that a significant proportion of people in Gwynedd are priced out of the housing market and that is more evident in communities with higher numbers of holiday homes.
“It is therefore inevitable that the significant number of houses being used as second homes and short-term holiday accommodation is affecting the ability of the people of Gwynedd to access homes in their communities.
“By introducing an Article 4 Direction, the Council will have a new tool to try to control the impact of second homes and holiday accommodation. The change will require owners to submit a planning application for changing the use of residential properties into second homes or short-term holiday accommodation.
“Following this decision, Gwynedd will become the first Planning Authority to use these new planning powers introduced by the Government. Detailed work has been carried out over the past year to set out the case for the change to be made and we are very grateful to everyone who took part during the public engagement period.”
In 2023 the Welsh Government introduced changes to the planning framework, giving local authorities power to manage future numbers of second homes and Airbnb-style short-term holiday lets.
Changes to the national planning framework have seen the introduction of three new classes of use, namely: main home, second home and short-term accommodation.
Each local planning authority has the power to decide whether planning permission is required to change from one use class to another by removing permitted development rights.
