Second Home Ownership reaches Record Level

HAMISH_MCTAVISH

The latest second homes statistics from estate agent Knight Frank said numbers rose to 245,384 in 2009, up 2.6 per cent on the previous year. Numbers dropped 0.4 per cent in 2008.


Knight Frank said rental holiday properties enticed buyers because their rents offered a 7 to 8 per cent return.



The promise of such income, linked to a property asset that can itself gain in value, is attractive to savers who face losing money on their other investments once inflation and tax is taken into account.

Furnished holiday lets also benefit from generous tax breaks – although the coalition has said it intends to make it much tougher for home owners to qualify for the breaks.

Liam Bailey, head of residential research at Knight Frank, said: “The second home market was one of the most resilient sectors of the housing market throughout the recent recession.”

And he added: “The recovery from the recession has coincided with a trend for taking holidays in the UK – in spite of a succession of three damp summers between 2007 and 2009

“The fashion for ‘staycations’ has been inspired partly by a weak pound and partly out of environmental concerns. Holidaying in the UK is now widely considered a ‘green’ option, especially when compared with long-haul destinations.”

He also said holiday lets have become a year-round investment.
“They were a luxury from which it was hard to derive a significant income. That has changed.”

http://www.telegraph.co.uk/finance/personalfinance/7948047/Number-of-second-homes-reaches-record-high.html

Really2

That may explain why 1/3 of sales seem to be cash sales at the moment.

ILW

Seems a little sad when a minority are buying up what is a scarce resource.

JonnyBravo

ILW wrote: »

Seems a little sad when a minority are buying up what is a scarce resource.

Sad for who?
Well clearly you mean the people not able to buy said resource.
At least remarkably few of those people are left without any housing at all.
No doubt you're all in favour of limits to control this?

Davesnave

Hmm....aren't those mooted tax break changes going to impinge here a bit in the future? This is a snapshot of the past.

Good though, if more people are holidaying in the UK now.

Bad if you happen to live in a village community which has been blighted by holiday homes.

So many pluses & minuses. :)

DaddyBear

JonnyBravo wrote: »

No doubt you're all in favour of limits to control this?

I am. You only need one home to live in. In a country with a gross housing shortage there need to be penalties for those owning more than one home, either in the form of higher stamp duty, an annual tax or both.
The village I last rented in, there was a huge demand for reasonably priced houses and in our street alone there were three second homes, one of which was occupied for about 4 weekends a year. These people need to be penalised.

CLAPTON

DaddyBear wrote: »

I am. You only need one home to live in. In a country with a gross housing shortage there need to be penalties for those owning more than one home, either in the form of higher stamp duty, an annual tax or both.
The village I last rented in, there was a huge demand for reasonably priced houses and in our street alone there were three second homes, one of which was occupied for about 4 weekends a year. These people need to be penalised.

presumably the accommodation you holidayed (sic) in could have been a family home for a local family

PasturesNew

Loads of empties here..... loads..... everybody thought it'd be a good investment... nobody thought about how to market it.

Also, the downside ... holidaymakers aren't the lovely people, smiling in adverts. No, holidaymakers are also idiots, crowds of kids overcrowding accommodation and away from home for the first time, dog owners, people whose idea of a holiday is to get totally w4nkered. The maintenance cost of a holiday home can be quite high. Call outs as they can't get in, call outs as things don't work (or they don't know how to make them work).

The tax break could be phenomenal... there were probably groups working together to make sure their family holiday homes were never rented to riff raff - they probably all holiday-home-swapped on the quiet.

Some places near me are 75% holiday homes. These communities now have no local garage, no local food shop, nothing - because most of the year it's deserted. Even bus services get cut back/axed and the school closes (to be done up as a bijou holiday let, or bistro).

A house that you can rent out for £700/month on an AST looks like it's going to lay golden eggs when you realise a week's peak season rent as a holiday let can bring in £700-1000. Now, instead of having it let all year, you can make the same money from 3 months' holiday lets. 8 weeks summer, Xmas week, New Year week, 2 weeks Easter, May bank holidays....

PasturesNew

Another dodge they pulled was to get their holiday home registered for business rates, not council tax. Then claim the low income lower rate. They made a killing in that as the business rates were lower than council tax. But the money goes somewhere different... I think business rates go to the Govt, whereas council tax goes to the council, or something.

Graham_Devon

There is absolutely nothing wrong with having some sort of tax penalty for owning a second home.

They do it on cars....want a nice car? Pay the tax privilege.

Doctor_Gloom

DaddyBear wrote: »

I am. You only need one home to live in. In a country with a gross housing shortage there need to be penalties for those owning more than one home, either in the form of higher stamp duty, an annual tax or both.
The village I last rented in, there was a huge demand for reasonably priced houses and in our street alone there were three second homes, one of which was occupied for about 4 weekends a year. These people need to be penalised.

Yes, well said. A super tax of say 60% would soon sort the greedy baskets out.