Should councils be able to cap the number of second and holiday homes in their area?

Earlier this week, the Lib Dems’ Communities and Local Government Minister Andrew Stunell wrote here on LibDemVoice about the Coalition’s measures to increase councils’ powers to cut tax relief to those with second homes:

… our plans [are] to allow local authorities to charge an Empty Homes Premium – up to an extra 50% of council tax – on any property that has been vacant for two years or more. Crucially, we are retaining the exemptions for properties empty as a result of the death of an owner, or if the owner has moved into hospital or to give or receive personal care (Exemptions E,F, I and J, since you asked). This will ensure that the tax burden does not fall unfairly on the shoulders of those who are least able to pay. But the moves will give councils an extra weapon in their arsenal to tackle empty homes, and will act as a spur to their owners to bring them back into use.

Under the Coalition’s proposals, councils would be able to keep what they save by cutting the current council tax discount, and could put that money either into spending on services or keeping tax bills down.

The issue of second and holiday homes is especially hot in the south-west, where many local people are priced out of the property market as wealthy city-dwellers buy-up coastal and rural retreats. Stephen Gilbert, Lib Dem MP for St Austell and Newquay, points out that in parts of Cornwall there are parishes where 80% of properties are second homes, and has urged the Coalition to go further than simply allowing councils to end tax relief — by giving councils the power to impose a cap on the number of second and holiday homes.

Here’s what Stephen asked Communities and Local Government Secretary of State Eric Pickles in the House of Commons on Monday:

Stephen Gilbert (St Austell and Newquay) (LD): Second home and holiday home ownership in some Cornish parishes is as much as 80% of the overall housing stock. As part of the Government’s localism agenda, will my right hon. Friend consider giving local authorities the power to limit the number of second and holiday homes in an area?

Mr Pickles: I think that would be rather difficult and open to abuse. This is an important step for my hon. Friend’s constituents and it should enable council tax bills to be cut by an average of about £20.

So it looks like the Coalition isn’t going to go down the route of a cap — do Voice readers think this is something the Lib Dems should be pressing for?

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7 Comments

  • Andrew Suffield 2nd Nov '11 - 6:23pm

    Unless you’re registered to vote at a particular residential property you own, or the people renting it out are registered, you should pay a council tax premium. This would also encourage people to get on the electoral roll.

    Cute idea, but no. If you have two homes and live in them both for roughly equal amounts of time in each year then you’re entitled to register on the electoral roll at both addresses, and vote in both sets of local elections. (You’re only entitled to vote in one place for national elections, but this is very difficult to enforce)

  • It is pretty hard to define a second home – can you really stop a couple from saying that A lives at address X and B at Y? Do we want people to have to keep a diary of where they spend their nights, with evidence?

  • Terry Gilbert 3rd Nov '11 - 10:00am

    @ Tim – It doesn’t stop them trying for benefit claimants!

  • peter tyzack 3rd Nov '11 - 12:08pm

    Why the discussion?…avoid the complexities… if it has a roof on it then it is a property. If it is residential then the owner pays Council Tax on it… if it is part of a business, holiday lets etc then treat it as a business and charge business rates.
    One way or the other all property should be contributing to the communal pot, no convoluted argument or complex system… only exemptions should be where a property is vacant following death of sole occupant, or resident has gone into care/ hospital.
    Possible only other additional exemption is if it is a single occupant who is on armed service duty.

  • peter tyzack 3rd Nov '11 - 12:10pm

    No need for all this discussion…avoid the complexities… if it has a roof on it then it is a property. If it is residential then the owner pays Council Tax on it… if it is part of a business, holiday lets etc then treat it as a business and charge business rates.
    One way or the other all property should be contributing to the communal pot, no convoluted argument or complex system… only exemptions should be where a property is vacant following death of sole occupant, or resident has gone into care/ hospital.
    Possible only other additional exemption is if it is a single occupant who is on armed service duty.

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