2nd home council tax

MobileSaver

ReadySteadyPop said:

MobileSaver said:

ReadySteadyPop said:

MobileSaver said:

ReadySteadyPop said:

https://thenegotiator.co.uk/news/regulation-law-news/authoritys-aggressive-second-homes-taxes-cause-12-4-fall-in-house-prices/

Buying opportunity for locals?

Did you actually read the article or just the click-bait headline?

"it still leaves many people priced out"

"may incentivise landlords to start using their properties for short-term lets"

So as the article says, apparently not a buying opportunity for locals...

But as you said only 3% of people have a second home? So second homes don`t contribute to the mythical "housing shortage" do they? And as you also seem to get, houses are still too expensive, and we all know the reason for that don`t we?

Many of that 3% own more than one second home so in total there are over 800,000 second homes in the UK which obviously is a factor in the housing shortage that is a fact of life.

Houses are expensive primarily because demand outstrips supply; there are not enough houses of the type that people want in the places that people want them. Additionally both materials and labour costs have increased significantly since Covid so new and replacement houses would be more expensive anyway even if the supply and demand market was balanced.

I see, so some people have been greedy? Where are all the locals living at the moment?

Purchasing a second home for holidays or as an investment is not remotely being greedy, that's just jealousy talking.

The locals complaining that prices are too high are presumably living in less than ideal homes right now and you would assume they're either lowering their expectations or working on bettering themselves so they can afford what they really want.

lincroft1710

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

FlorayG said:

I don't think you have much of a case. While your situation is slightly different to those who have a 'holiday home', the council will say you could rent somewhere or have lodgings or stay in an AirBnB or hotel 3 nights a week while a local family could buy your property and live in it.

Agree. Is there any need to own a property where you will only stay for a maximum of 40% of the time?

Wealthy people do this all the time, with multiple properties, 40% of the time is quite a lot.

The OP doesn't appear to be that wealthy as they are considering selling up and leaving their job. Also I said a maximum of 40%, the usage is probably nearer 30%  which means the property is unused for considerably more time than it used. 

 To the people advocating double or more council tax to get more "locals" prioritised this would be win win, an extra house and an extra job for a local? The irony is that it was the "global village" experiment with it`s super low interest rates and super cheap goods from China that allowed loads of ordinary people to hoover up extra property in the first place! Previous generations of working people didn`t have that access to credit/equity, but the reversal could be brutal as councils now treat property as a revenue gathering tool?

What are you talking about? "Global Village Experiment?" "Loads of ordinary people to hoover up extra property?"


You can rail and rant on about the second home premium until the cows come home but it is what the government wants and will thus stay until Parliament decides otherwise.

Without super cheap mortgage debt a lot of people wouldn`t have second homes, now they are in a position of much more expensive mortgage debt, higher cost of living AND double (or more if some people get their way!) council tax!

Where's your evidence of "super cheap mortgage debt"?

2010 to 2021 is a good place to look.

That's not evidence of SCMD just a time when interest rates were low, house prices weren't, so mortgages were still costly

ReadySteadyPop

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

FlorayG said:

I don't think you have much of a case. While your situation is slightly different to those who have a 'holiday home', the council will say you could rent somewhere or have lodgings or stay in an AirBnB or hotel 3 nights a week while a local family could buy your property and live in it.

Agree. Is there any need to own a property where you will only stay for a maximum of 40% of the time?

Wealthy people do this all the time, with multiple properties, 40% of the time is quite a lot.

The OP doesn't appear to be that wealthy as they are considering selling up and leaving their job. Also I said a maximum of 40%, the usage is probably nearer 30%  which means the property is unused for considerably more time than it used. 

 To the people advocating double or more council tax to get more "locals" prioritised this would be win win, an extra house and an extra job for a local? The irony is that it was the "global village" experiment with it`s super low interest rates and super cheap goods from China that allowed loads of ordinary people to hoover up extra property in the first place! Previous generations of working people didn`t have that access to credit/equity, but the reversal could be brutal as councils now treat property as a revenue gathering tool?

What are you talking about? "Global Village Experiment?" "Loads of ordinary people to hoover up extra property?"


You can rail and rant on about the second home premium until the cows come home but it is what the government wants and will thus stay until Parliament decides otherwise.

Without super cheap mortgage debt a lot of people wouldn`t have second homes, now they are in a position of much more expensive mortgage debt, higher cost of living AND double (or more if some people get their way!) council tax!

Where's your evidence of "super cheap mortgage debt"?

2010 to 2021 is a good place to look.

That's not evidence of SCMD just a time when interest rates were low, house prices weren't, so mortgages were still costly

The monthly payments were affordable, that is all many people looked at, the monthly debt maintenance payments are a lot more costly now.

TroubledTarts

Many second homes were bought as investments for retirement and other means. 

My parents had a 2 up 2 down investment property that doubled as a holiday home in Derbyshire for 10 years. Bought for £12,500 and sold for £109,950.

Obviously there were running costs and maintenance costs but nonetheless a great investment and return.

Double council tax would have been an extra expense each year but would have been a good investment.

Even properties (I mean houses not flats, unless they are amazingly located flats)if you look at prices 10 years ago to today there is money to be made on second properties as bolt holes/holiday/investment. Even with the double council tax. It's just less attractive and the more risk adverse will now shy away from this option for their investments. 

Bigphil1474

ReadySteadyPop said:

Bigphil1474 said:

GDB2222 said:

I do wonder whether the councils will be able to manage financially without second home owners? A typical second home uses scarcely any council resources. Certainly not the most expensive services, such as schools and social care. 

That's the problem not the upside. If you have a local family living in a local house and working locally, they spend their wages in the local shops, their kids go to the schools, they use local services. Only about a fifth of my local council's revenue comes from council tax - there's government grants, property revenue, business rates etc. Government funding is based on loads of factors but the make up of the local population is part of that - deprivation, unemployment, wealth etc. Second home owners aren't local population. Deprived areas have actually been the worst hit from austerity.  Second home ownership does nothing for the local community, hence the need to double council tax to discourage 2nd home ownership (which seems to be working in this case), or increase council revenue to make up the shortfall in the community. 

But an earlier poster said that only 3% of the population have a second home, I don`t get it?

Even if that 3% is true, which I have no reason to doubt, that's 3% of the entire housing stock across the whole country. If you look at coastal towns popular with tourists, for example, I would suspect the % is much higher. 

In Whitby, North Yorkshire, where they have been having this issue, a couple of years ago they estimated something like 20% of domestic properties were either empty or second homes, and another 15% or so were registered as holiday homes. In total of their 9,500 domestic properties , over 3,000 had no usual resident. That doesn't include any AirBnB type places not registered as holiday homes. That's huge. 

newsgroupmonkey_

ReadySteadyPop said:

400ixl said:

ReadySteadyPop said:

Bigphil1474 said:

GDB2222 said:

I do wonder whether the councils will be able to manage financially without second home owners? A typical second home uses scarcely any council resources. Certainly not the most expensive services, such as schools and social care. 

That's the problem not the upside. If you have a local family living in a local house and working locally, they spend their wages in the local shops, their kids go to the schools, they use local services. Only about a fifth of my local council's revenue comes from council tax - there's government grants, property revenue, business rates etc. Government funding is based on loads of factors but the make up of the local population is part of that - deprivation, unemployment, wealth etc. Second home owners aren't local population. Deprived areas have actually been the worst hit from austerity.  Second home ownership does nothing for the local community, hence the need to double council tax to discourage 2nd home ownership (which seems to be working in this case), or increase council revenue to make up the shortfall in the community. 

But an earlier poster said that only 3% of the population have a second home, I don`t get it?

If you apply common sense then you will spot that these second homes are often in hotspots like costal towns / villages where the impact is magnified and causes real local issues.

If you aren't in a hotspot then the impact will be minimal in the grand scheme of things. Although some other areas have an issue with derelict housing being the issue and depleting the housing stock.

Difficult to have one rule for one postcode and another for a different one.

That is why they are doing one rule for all postcodes?

Well, no. They're not.
I believe not all councils chose to charge the extra 100%. They had leeway to do from 0 to 100.
25% apparently chose not to according to a report last July.

ReadySteadyPop

TroubledTarts said:

Many second homes were bought as investments for retirement and other means. 

My parents had a 2 up 2 down investment property that doubled as a holiday home in Derbyshire for 10 years. Bought for £12,500 and sold for £109,950.

Obviously there were running costs and maintenance costs but nonetheless a great investment and return.

Double council tax would have been an extra expense each year but would have been a good investment.

Even properties (I mean houses not flats, unless they are amazingly located flats)if you look at prices 10 years ago to today there is money to be made on second properties as bolt holes/holiday/investment. Even with the double council tax. It's just less attractive and the more risk adverse will now shy away from this option for their investments. 

Not doable now due to the years of cheap debt, same with BTL, not a good investment at all for retirement, possibly the worst investment you could make buying now, that is why many holiday home owners trying to sell are going to be disappointed with the offers they get, if any, people are waking up to how much of a financial burden property can be (especially if you are letting it or not living in it the whole time) Stock markets are the place to go, massive opportunity coming over the next few years. The only reason millions of people "invested" in property was that you can borrow money to do that, the bank won`t let you borrow for stocks, many didn`t think it through any deeper than that and the historical examples like yours only served to encourage more and more people to pile in.

ReadySteadyPop

Bigphil1474 said:

ReadySteadyPop said:

Bigphil1474 said:

GDB2222 said:

I do wonder whether the councils will be able to manage financially without second home owners? A typical second home uses scarcely any council resources. Certainly not the most expensive services, such as schools and social care. 

That's the problem not the upside. If you have a local family living in a local house and working locally, they spend their wages in the local shops, their kids go to the schools, they use local services. Only about a fifth of my local council's revenue comes from council tax - there's government grants, property revenue, business rates etc. Government funding is based on loads of factors but the make up of the local population is part of that - deprivation, unemployment, wealth etc. Second home owners aren't local population. Deprived areas have actually been the worst hit from austerity.  Second home ownership does nothing for the local community, hence the need to double council tax to discourage 2nd home ownership (which seems to be working in this case), or increase council revenue to make up the shortfall in the community. 

But an earlier poster said that only 3% of the population have a second home, I don`t get it?

Even if that 3% is true, which I have no reason to doubt, that's 3% of the entire housing stock across the whole country. If you look at coastal towns popular with tourists, for example, I would suspect the % is much higher. 

In Whitby, North Yorkshire, where they have been having this issue, a couple of years ago they estimated something like 20% of domestic properties were either empty or second homes, and another 15% or so were registered as holiday homes. In total of their 9,500 domestic properties , over 3,000 had no usual resident. That doesn't include any AirBnB type places not registered as holiday homes. That's huge. 

Yes, but higher for longer rates will fix the problem, only people with actual cash in the bank will be able to have second homes, the days of leveraging up on a primary home, a couple of BTL`s and then a house by the sea on a mortgage relying on always having tenants and always having cheap monthly re-payments are long gone.

theartfullodger

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

ReadySteadyPop said:

lincroft1710 said:

FlorayG said:

I don't think you have much of a case. While your situation is slightly different to those who have a 'holiday home', the council will say you could rent somewhere or have lodgings or stay in an AirBnB or hotel 3 nights a week while a local family could buy your property and live in it.

Agree. Is there any need to own a property where you will only stay for a maximum of 40% of the time?

Wealthy people do this all the time, with multiple properties, 40% of the time is quite a lot.

The OP doesn't appear to be that wealthy as they are considering selling up and leaving their job. Also I said a maximum of 40%, the usage is probably nearer 30%  which means the property is unused for considerably more time than it used. 

 To the people advocating double or more council tax to get more "locals" prioritised this would be win win, an extra house and an extra job for a local? The irony is that it was the "global village" experiment with it`s super low interest rates and super cheap goods from China that allowed loads of ordinary people to hoover up extra property in the first place! Previous generations of working people didn`t have that access to credit/equity, but the reversal could be brutal as councils now treat property as a revenue gathering tool?

What are you talking about? "Global Village Experiment?" "Loads of ordinary people to hoover up extra property?"


You can rail and rant on about the second home premium until the cows come home but it is what the government wants and will thus stay until Parliament decides otherwise.

Without super cheap mortgage debt a lot of people wouldn`t have second homes, now they are in a position of much more expensive mortgage debt, higher cost of living AND double (or more if some people get their way!) council tax!

Where's your evidence of "super cheap mortgage debt"?

2010 to 2021 is a good place to look.

That's not evidence of SCMD just a time when interest rates were low, house prices weren't, so mortgages were still costly

Under Thatcher in November 1979 Boe interest rates hit 17%. No offence but young kids today have no idea.

I had a for then large mortgage, two salaries coming in, tough ..

Bigphil1474

They are really not long gone. The margins are smaller, but there'll be plenty of people who will keep hold of their holiday homes / second homes, because they can. The double council tax won't mean everyone sells up, some will and some won't. If you are renting a property out for six or seven £hundred a week for 6 months of the year, an extra couple of £k in council tax a year isn't going to stop you making a profit. And many owners will have paid off those mortgages during the very low interest rate years. A mortgage under 5% is still a cheap mortgage.