Council tax hikes for second homes spark mass sell-off

When Pembrokeshire added a 200% premium to council tax (CT) for second home owners in April it sparked a mass sell-off with the number of them being put on the market trebling.

The rise came after the Welsh Government introduced new rules to try and prevent locals being priced out, particularly in seaside areas. The changes allowed local authorities to charge up to a 300% council tax premium for second homes.

Many authorities, including Pembrokeshire, have already put up their rates. Cyngor Gwynedd now charges a 250% premium and Anglesey and Conway has a 100% premium.

Huge impact

Neil Evans, the owner of West Wales Properties, told the BBC the council tax premium has had a “huge impact”, especially in places such as St Davids and Newport (both Pembrokeshire).

“We’re seeing properties come on the market at such a volume that I’ve never seen in 30 years.

“[Second home owners] can purchase a property on the other side of the Severn Bridge and have none of this.

“I think what we’re finding generally is that it’s affected the holiday trade as well.”

A lot of them simply are putting them on the market because they’ve had enough.”

And Emma Downey, owner of Tides Kitchen and Wine Bar in Newport added: “People who have second homes here are desperately angry at the charges they’re now facing, and a lot of them simply are putting them on the market because they’ve had enough.”

And with the Council Tax rules changing in England in April next year, it has implications there too as it will allow local authorities to charge a premium of up to100%.

It has led to growing concerns that with CGT also set to rise, the sell-off of both second homes and buy-to-lets could lead to the market being deluged with properties for sale in affected areas of both England and Wales.