Second homeowners in Wales could have to pay more tax to support local communities

  • Watch ITV Cymru Wales' video report by Jess Main

The Welsh Government has set out plans to address the impact of second home owners on communities in Wales.

Julie James, minister for climate change, announced the "three-pronged approach" to the Senedd on Tuesday 6 July.

This included addressing the issue of affordable and available housing in Wales.

Second homeowners will have to make a "fair" contribution to communities in the form of national and local taxes.

Julie James, Minister for climate change, will announce the "three-pronged approach" to the Senedd on Tuesday

Owners of holiday accommodation will also face stricter registration policies.

A pilot scheme will start later this year where the measures laid out will be trialled.

The pilot area will be decided in summer.

The scheme will then be evaluated before being considered for rollout across Wales.

Work on a registration scheme for all holiday accommodation and a consultation on changes to local taxes will also begin over the summer.

Ms James said: "The continuing rise of house prices mean people, especially younger generations, can no longer afford to live in the communities they have grown up in.

"A high concentration of second homes or holiday lets can have a very detrimental impact on small communities, and in some areas could compromise the Welsh language being spoken at a community level.

"We have already taken strides on some of these issues - last year we became the only nation in the UK to give local authorities the power to introduce a 100% council tax levy on second homes.

"But the urgency and gravity of this situation calls for further intervention, which means real and ambitious actions are delivered at pace, to inject fairness back into the housing system."

The pilot area will be decided in summer.

Ms James visited St David's in West Wales on Monday to hear how money raised from the council tax levy had been used to build 18 affordable homes for local people.

She said this demonstrated how community action and government policy could "bring fairness back into our housing market".

25-year-old Rachel from Solva had a chance to chat to the minister in charge of housing.

She wants to see more opportunities for young people like her to get a foot on the property ladder.

She said: "I'm currently living in a caravan because I can't find anywhere to rent that I can afford and I definitely can't afford to buy.

"It's just frustrating, the thought that we're going to have to probably move away in order to purchase a property just because we're being priced out in our own area, when the majority of the year, those properties are being left vacant."

Rachel wants to see more opportunities for young people to get a foot on the property ladder

The Welsh Government's plans take recommendations from a report by Dr Simon Brooks, associate professor in the school of management at Swansea University, which was published earlier this year.

At the beginning of 2020, it was estimated that there were 24,423 second homes in Wales that could be taxed on that basis.

Government figures from that year suggest second homes and holiday lets were more than 10% of the housing stock in Gwynedd, 9.15% of the stock in Pembrokeshire and 8.26% of it in Anglesey.

Dr Brooks' report warns that both Brexit and the Covid-19 pandemic will increase pressure on the housing market in Wales and urges ministers to take "radical action" in communities already affected by second homes.

He states there is evidence the second home "problem" affects four county council areas - Gwynedd, Pembrokeshire, Anglesey and Ceredigion - more than others.

Three of these are considered to form the core of traditional Welsh-speaking Wales, while Pembrokeshire also has "linguistically sensitive neighbourhoods", Dr Brooks says.

The Welsh Government, as part of its approach to second homes, is due to publish a Welsh Language Community Plan for consultation this autumn.

Ms James said it was part of measures to "kick-start a summer of action" to establish how to tackle the issue of second homes.

"I am calling on all political parties across the Senedd to get involved in this, as we look to empower our communities to exercise their right to live in good quality homes, wherever they are in Wales," she added.

Responding to the plan, Plaid Cymru housing spokesperson Mabon ap Gwynfor described it as an "exercise in kicking the problem into the long grass".

He said: "These weak measures will not be nearly enough to truly get to grips with a housing emergency that is fast engulfing our communities at an alarming rate. There is nothing here about closing the council tax loophole. There is nothing here about imposing caps on second homes.

"And there is nothing here about bringing numbers of holiday homes into community ownership through public intervention - diverting profits to local developments such as the provision of social housing. In fact, there is no detail just vague plans for more consultation.

"What our communities need is urgent action before it's too late - not painfully long-drawn out consultations or half-hearted trials."