According to the latest research, second home ownership is reported to be 1 in 34 homes in Dorset, one of the highest in the country. It is reported that locals and first-time buyers are struggling to get on to the housing ladder in many areas, as rentals and second homes restrict the supply of houses. This comes as interest rates, set by the Bank of England, were increased in December to their highest rates since the 2008 financial crisis.
Local agents have reported to us that the property market has taken a downturn. Bournemouth agents Martin & Co shared with us a reported drop in sales by around 16.5% in the Bournemouth area, suggesting that this was because of the interest rate increases. However, they are keen to point out that interest rates are in reality still low compared to periods in the 1980s and 1990s.
Holiday and short-term lets make up a large section of the rental market in the Bournemouth region. Extensive beaches and areas of outstanding natural beauty, such as the Jurassic Coast or New Forest in close proximity, makes it a hotspot for tourists and property investors looking to provide accommodation. In other regions action has been taken to limit second homes.
Cornwall has 13,292 registered second homes. Its council implemented a housing policy that stipulates residency or local ownership restrictions on some properties. The council’s cabinet approved plans on 16th December 2022 to double council tax for second homes, although this will need to be approved by parliament in the Government’s Levelling Up and Regeneration Bill.
Scott Mann, MP North Cornwall, supports the primary residence policy. He commented on how second home ownership and buy-to-let properties are squeezing the housing market for local people trying to get on to the ladder in many parts of the country. He called for “bespoke solutions” to the problem in different parts of the country.
“I think fundamentally at the moment, the big elephant in the room is buy-to-let and short-term letting. When they’re [houses] bought, they are basically just flipped straight away. Then we lose them from a main residence into a buy-to-let.”Scott Mann, Government Whip & North Cornwall MP.
The measures taken in Cornwall are a potential roadmap for other councils, such as BCP or Dorset County Council, to follow suit and explore housing policy for local people.