Holiday lets firm says tourist areas need more affordable homes

A major holiday let company in one of the country’s prime tourist destinations says more affordable homes should be built to solve the housing crisis.

Cornwall has been in the eye of a storm over the impact of traditional holiday lets and short lets on local housing markets, with numerous stories in the past year about the lack of affordable homes in the county.

Now Julianne Shelton, a co-founder of holiday lets firm Cornish Gems, has told the local media in the county that tourism is the life blood of the economy. 

She is quoted on the Cornwall Live website as saying:“Cornwall’s popularity and strong visitor numbers is overall an advantage and essential for the future sustainability of the Cornish economy. Tourism is one of the largest sectors that provides jobs throughout the county all year round which is vastly different to the shorter season when I was growing up in Cornwall working in hospitality.

“The problem is that salaries here in Cornwall are some of the lowest in the country, that coupled with higher than national average property prices make the affordability for locals buying property extremely difficult.

"We’re currently investing in a benchmarking audit to ensure our salary and benefit packages are competitive to secure and retain talent here in Cornwall as our independent company grows.”

Shelton adds: “The three per cent additional stamp duty on second home purchases has largely been supported, but it would be useful to hear more on how the additional three per cent will be used specially to create new affordable homes for local people – and not see it being absorbed into the larger pot funding unrelated Government projects.”

Her firm, which currently employs 100 people, is recruiting 30 more this year.

Owners of second homes who abuse a tax loophole by claiming their often-empty properties are holiday lets will be forced to pay under new measures announced by the government at the end of last year.

The Department of Levelling Up, Housing and Communities says the changes will target people who take advantage of the system “to avoid paying their fair share” towards local services in popular destinations such as Cornwall, Devon, the Lake District, Suffolk, West Sussex and the Isles of Scilly.

Currently, owners of second homes in England can avoid paying council tax and access small business rates relief by declaring an intention to let the property out to holidaymakers. 

However, concerns have been raised that many never actually let their homes and leave them empty and are therefore unfairly benefiting from the tax break.

Following a consultation, the government says it will now bring changes to the tax system, which will mean second homeowners must pay council tax if they are not genuine holiday lets.

From April 2023, second homeowners will have to prove holiday lets are being rented out for a minimum of 70 days a year to access small business rates relief, where they meet the criteria.

Holiday let owners will have to provide evidence such as the website or brochure used to advertise the property, letting details and receipts.

Properties will also have to be available to be rented out for 140 days a year to qualify for this relief.