No place in the sun: is this the end for holiday home owners?

New law could require landlords to obtain permits to rent properties on sites like Airbnb

Holiday Lets
Michael Gove’s plans have come under fire from his own party as ‘anti-business’
(Image credit: Illustrated/Getty Images)

Short-term holiday lets could require a permit under new government plans to ease pressure on the housing market and help local residents afford homes.

Under the proposals, homeowners in England would need permission from local authorities before converting properties into holiday rentals or listing their houses on websites like Airbnb.

“Tourism brings many benefits to our economy,” said Michael Gove, the secretary of state for levelling up, housing and communities, “but in too many communities we have seen local people pushed out” by short-term lets.

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But Gove’s predecessor as housing secretary, Simon Clarke, called the planned restrictions “anti-business”. The proposals stemmed from “our failure to build enough homes” and could damage the UK’s tourism industry, he wrote on Twitter.

What did the papers say?

The plans, part of the Levelling Up and Regeneration Bill going through Parliament, could be introduced later this year. As part of the consultation, the government is expected to set a rental period of between 30 and 90 days before a homeowner would need to apply for planning permission to convert their property.

Ministers also intend to alter planning laws to allow councils to ban future holiday lets if the area does not have enough affordable housing.

Separately, the culture department has launched a consultation on a national registration scheme for short-term lets, which would allow local authorities to keep track of the number of holiday homes in their area.

According to council figures obtained by the BBC last year, the number of holiday rentals in England rose by 40% between 2018 and 2021, especially in popular tourist areas like North Devon, Cornwall and the North Sea town of Scarborough. Residents of Whitby, in North Yorkshire, voted last year to ban new-build properties from becoming second homes or holiday lets.

A source told The Times that the plans had been driven by fears that in some areas, new-build homes were being “bought up en masse by speculative landlords” to rent out on Airbnb. The situation is “distorting the market”, the source said.

According to data from Inside Airbnb, a non-profit highlighting the company’s impact on housing markets, and analysed by The Guardian, the number of full properties to rent in coastal areas increased by 56% between 2019 and 2022, and 15% in non-coastal areas. One in 67 coastal homes were listed on Airbnb in May last year.

But Airbnb, while welcoming the plans for a national register, said that the changes should “strike a balance between protecting housing and supporting everyday families to let their space to help afford their homes”.

Almost 40% of Airbnb hosts said their earnings helped them afford the rising cost of living, Theo Lomas, the company’s head of public policy and government relations for northern Europe, told The Guardian.

What next?

Holiday let ownership “soared in the wake of the pandemic”, said The Daily Telegraph, “as buy-to-let investors capitalised on increased demand for staycations and a stamp duty holiday, which made it cheaper to buy second homes”.

But now, tourist hotspots like the North Devon seaside village of Lynmouth are “basically empty” in winter, residents told the Telegraph, while locals were unable to find places to rent.

Although landlords argued that holiday lets and second homes helped sustain tourism and therefore local economies, “this village was built on tourism and there are so many B&Bs already”, Russell Kingston, a 35-year-old resident, told the Telegraph. “Those houses are built to be B&Bs. Someone is living there and providing the service. That’s a job, a house, and a business.”

“To the proud people of rural Britain there is no greater insult than the city dweller’s second home,” said The Times’s editorial. “The sorry sight of country villages whose shops, schools and pubs have shut but for lack of custom, and whose homes and cottages come to life only in the holiday season, has even driven some to violence.”

The concerns of locals who were “effectively denied their birthright of a house in their home town or village by wealthy incomers” were understandable, and the policy recognised a serious problem: Britain’s “acute” housing shortage.

But “Gove’s method is misguided,” the paper said. He “has taken aim at the wrong target, and he knows it”. The scheme will do nothing to help those struggling to buy a home, but building more homes will. “All else is a distraction from this catastrophic failure of political will.”

A Conservative MP told the i newspaper that Gove had “prioritised concerns about over-development in some MPs’ constituencies over more robust measures to tackle the national housing crisis”. The majority of Conservative voters think more social housing should be built, according to YouGov polling for the paper.

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