House prices are falling in many of Britain’s second-home hotspots, while the number of second homes in England is also declining, according to the latest data.

Analysis by Rathbones found that house prices fell in 19 of the 25 areas with the highest density of second homes, but were down in only 26% of local authorities in the wider UK.

By the first quarter of 2026, the wealth manager says that figure had risen to 20 of the 25 of those local authorities.

Coastal markets

Many of the worst-performing areas were coastal and rural markets traditionally associated with holiday-home demand. South Hams in Devon, which has the highest concentration of second homes in England, recorded an annual price fall of 6.6%.

In addition, separate Government figures show the number of second homes in England has fallen by around 12,000 since 2024, a decline of 4.3%.

Unfavourable tax changes”

Rathbones says the appeal of “additional property ownership for financial gain appears greatly reduced” and argues that there have been “unfavourable tax changes” for owners of additional properties.

The Stamp Duty surcharge on additional properties was increased from 3% to 5% in October 2024. Councils in England can also now charge a 100% council tax premium on second homes, and local authorities in Wales can impose premiums of as much as 300%.

The Telegraph reports Liberal Democrat MP Andrew George is also proposing new planning powers that would allow councils to restrict the conversion of homes into second homes in areas that are facing housing shortages.

Although the proposal is a Private Member’s Bill and is unlikely to become law, it is part of a growing political backlash against second-home owners.