EXCLUSIVE: North Yorkshire locals rubbish plan to double council tax
EXCLUSIVE: Locals in North Yorkshire tourist hotspots rubbish plans to crack down on second home owners: Bid to DOUBLE council tax to deter city dwellers won’t work because of holiday lets ‘loophole’, residents claim
- North Yorkshire voted for a 100 percent tax premium for second home owners
- The measure is aimed to return houses to local residents and drive down prices
- Tory councillor David Chance said some villages have 11 permanent residents
- But locals say an ‘easy loophole’ means it could backfire on council bosses
- MailOnline found 125 properties in one village for rent on Tripadvisor for tourists
Doubling council tax for second home owners in the north of England will not help villages which have just a dozen permanent inhabitants because owners will use an ‘easy loophole’ to pay nothing at all, residents have warned.
Councillors in North Yorkshire declared war on second home owners in November by voting to double their council tax in a bid to make more homes available for local people priced out of the market.
Second home owners in targeted tourist hotspots including Staithes and Runswick Bay told MailOnline they believe the move is a ‘political stunt’ and that ‘local people do not want to live here’.
The few locals who remain warned second homes and holiday lets have ‘ripped out the heart’ of small villages in the county, but that the council’s solution will not work due to an ‘easy’ tax loophole.
The streets of Staithes are near-empty outside of tourist season as the majority of properties are now holiday lets of second homes
Conservative councillor David Chance said there are just 30 permanent residents left in the whole of Staithes
Councillors in the Scarborough area say two of the county’s most popular villages have almost no permanent residents left: Staithes has just 30 while Runswick Bay has 11.
The council made the ‘ground-breaking’ tax rise decision last month, although noted it will need government legislation to pass before is can be enacted as planned in April 2024.
Tory councillor for Danby and Mulgrave David Chance told the November meeting that hardly any of the homes in seaside villages in his ward were now occupied permanently, and it is ‘tearing the heart out of our communities’.
According to the county council, the average cost of a property in the Yorkshire Dales is nearly £400,000, while the weekly wage in North Yorkshire is just over £530.
The popularity and scenery of the Yorkshire Dales make it one of the most sought-after spots for second homes in the UK, but locals say it is having a detrimental impact on the affordability of properties, with many forced out of the area.
The National Housing Federation (NHF) says there are at least 8,199 second homes in North Yorkshire – the highest number in the Yorkshire and Humber region.
In a statement, the council said the plan to double second home owners’ council tax bills could raise more than £14 million per year in North Yorkshire, with the Scarborough area accounting for half of this on its own.
But amid empty streets in Staithes and Runswick Bay in the Scarborough area, villagers were sceptical that the hike would do any good, because it would not make house prices in tourism honeypots any more affordable for locals.
Some second home owners said they would simply change their residence to a business instead to avoid the measure – a legal loophole means that letting out a property for a few weeks a year enables the owners to avoid paying any council tax at all.
Many local businesses depend on visitors for their livelihoods and think the local economy would flatline if second home owners were driven away.
At Staithes Gallery, new bosses Ian and Susan Burke say the village has lost its community.
According to the county council, the average cost of a property in the Yorkshire Dales is nearly £400,000, while the weekly wage in North Yorkshire is just over £530
Many local businesses depend on visitors for their livelihoods and are worried higher council tax rates will push them away
Staithes is a beautiful village on the north coast – but has just 30 permanent residents living there
Runswick Bay, which is even smaller than Staithes, has just 11 permanent residents, according to its local councillor
Susan Burke says Staithes in North Yorkshire has lost its local community feeling
Until recently, Mr Burke was head of art at Eton where he worked for 20 years and even taught Prince Harry. The couple then took over the gallery in February 2022 after first coming to the village 25 years ago.
Mrs Burke said: ‘There were quite a few second homes which were empty for 40-odd weeks of the year.
‘Then I heard one man had bought three cottages and we realised people were starting to snap up every house available and were turning them into holiday cottages.
‘We took the gallery over in February and have really noticed the change. Nearly every house is let 52 weeks a year.
‘It has knocked a lot of the soul and heart out of the community. The local families, the characters we used to see in the village, a lot of those have gone.
‘And a lot of the people who are still here really miss that sense of community.
‘On the positive side, they used to be lots of really run down houses here. The first time I saw Staithes I did not like it. It was dark and gloomy.
‘So in that respect it has brought business into the village and it looks [less] dingy because if you want people to choose your holiday cottage it has to be immaculate.
‘But the local people do look a bit lost. It must be really, really hard to be here all the time when everyone is a stranger.’
They added Staithes has seen fierce demand for more tourism-related businesses in recent years, meaning the village now has a restaurant, fudge shop, deli, plus lots of shops and cafes.
James Mason, 85, who is from Newark but has had a second home in Staithes for ten years, said: ‘Obviously, I don’t agree with [the tax rise] because I have to pay it.
‘I don’t think it is going to be effective either. Locals do not want to live in Staithes because of the hill. It is a holiday destination.
‘Business rates here are zero. So, all I shall do is convert my house to a business to get around it. I can understand it in real hotspots like Cornwall.
‘But locals do not want to live here. There are no jobs. Without the second homeowners the economy will really sink.
‘Or people will sell up and move on and the place will be totally dead. If I have work done here, it is always local. I don’t have deliveries. I use the local shops.
‘This is going to drive people like me out.’
Dennis Whiteley, 74, said it is ‘very easy’ for second home owners to use a legal loophole and avoid paying council tax altogether
The former fishing village of Runswick Bay has consisted of 80 houses for hundreds of years
Residents of Runswick Bay feared the council tax hike could backfire if passed by the government
Holiday lets in Runswick Bay have to be ‘immaculate’, according to local residents
A few miles away, the former fishing village of Runswick Bay has consisted of 80 houses for hundreds of years.
Now – with small cottages changing hands for half a million pounds and the bigger houses for up to £1 million – there are only 11 permanent residents remaining.
One of them, Dennis Whiteley, 74, a retired businessman, feared any council tax hike could backfire because it would persuade existing second home owners to take advantage of the rating system.
‘Instead of paying double council tax people will let their properties out for a few weeks a year and will not pay any council tax. It is a fairly easy loophole.
‘It is very easy for people to turn their cottage into a holiday let, make a few bob, and avoid paying the council tax.
‘The village is pretty quiet at the moment. But we like it that way, rather than when things go crazy in the summer.
‘I think doubling council tax is a political stunt that is not going to resolve the problems of local people being able to buy houses in seaside resorts.’
But a second permanent resident, who has lived in the village for more than 50 years, told MailOnline he supported the concept of second home owners paying more.
He said: ‘There have been 80 houses for hundreds of years. It was literally a fishermen’s village. Then in the 1960s that started to fade away.
‘People bought cottages then and they were kept in families. But over the last 20 years people have died, the families have sold on and it has become a holiday cottage village.
‘What annoys me is many of them pay less, sometimes nothing, by paying business rates rather than council tax.
North Yorkshire councillor David Chance spoke strongly in favour of the council tax hikes for second home owners in November
‘If they can afford a holiday home they can afford to pay the extra. We might be able to attract more retired people if we had less holiday lets but the prices are ridiculous down here.’
Holly Smith, 63, who owns two cottages in the village with her husband, said: ‘I can understand [the tax rise]. It is not so bad for this community because there is nothing to do down here.
‘No one would want to live in a house the size of my holiday cottage. It is not big enough. There is nowhere to park and nowhere for children to play.
‘I am quite happy to contribute. We have had the house ten years and there have been holiday homes here for 40 to 50 years.
‘Business owners are happy they are being let because it is keeping the village alive.
‘At least if they are let, there is money coming into the area. If they weren’t they would not be contributing anything.’
The decision to double council tax for second home owners was the first such vote in England, but other areas of the UK have been quick to follow.
Residents have questioned how much the measure would help when many properties are already used as holiday lets or are available to rent on Airbnb, and will therefore be unaffected.
In Staithes, Airbnb has at least 54 properties to choose from for those wishing to visit the town, which has just 30 permanent residents.
In Runswick Bay, which is significantly smaller, there are eight properties available.
Meanwhile Tripadvisor boasts 125 properties to rent in Staithes.
North Yorkshire may have been the first area to vote to introduce an additional 100 percent premium, but others have been quick to follow.
At the start of December, Cornwall council voted to charge a 100 percent council tax premium on residents who leave their properties empty for one year or more.
It is estimated that there are more than 13,000 properties in Cornwall classed as second homes on the council tax system — one of the highest levels in the country.
And in one of the most popular areas for holiday homes along the Welsh coast in the county of Gwynedd – including Snowdonia and the North Wales coast – second home owners could soon pay a 150 percent premium on top of regular council tax.
The Welsh Government minister for finance and local government, Rebecca Evans, previously announced that the change will come into effect on April 1 next year.
Discussion around the Council Tax Premium across Wales has largely focused on the impact of holiday homes on the local housing economy as it has widely led to an increase in prices surpassing what some local residents can afford.
Arguing for the North Yorkshire hike last month, councillor David Chance told his colleagues: ‘In Staithes, for instance, we have 12 permanent residents in the lower village. In Runswick Bay we have 11 [later corrected to 30] permanent residents in the lower village.
‘All the remaining houses are either second homes or holiday lets.’
He added: ‘Whitby people cannot afford to purchase a home in their own town. Whitby wages can’t even afford “affordable” homes.
‘We’ve built a lot of homes in Whitby recently and they’ve all been snapped up by outsiders.
‘A lot have gone to second homes and a lot have gone to holiday homes and it’s tearing the heart out of our communities.’
Some of the villages within North Yorkshire have become almost entirely occupied by tourists or second home owners
The council said the introduction of a 100% premium on council tax bills for second homes could generate in excess of £14 million a year in additional revenue (Pictured: Staithes)
Tripadvisor boasts 125 properties to rent in Staithes, and Airbnb has 54 places available
Set so close to the sea and the Yorkshire Dales, Staithes is a tourist hotspot, and highly desirable for those searching for a getaway home
Council leader Carl Les welcomed the decision by the meeting of the full council to pursue the council tax premium on second homes, which he claimed is a ‘critical tool’ in helping provide more affordable housing.
Mr Wes said after the meeting: ‘Today’s decision by the full council is a major step forward to helping tackle what has been such a long-running issue that has affected communities across North Yorkshire.
‘It is heartening to have support from leading organisations involved in the housing sector, and the importance of trying to provide more housing for local communities should never be overlooked.
‘To ensure people can live in the places they want to is vital to ensure that these communities remain sustainable for the future, and the council tax premium is a critical tool in achieving that.’
Outside the Scarborough district, the council expects Richmondshire to generate about £1.8 million through the second homes premium, while the Craven, Harrogate and Ryedale districts could each provide about £1.5 million in extra revenue.
Hambleton could provide £1 million and the Selby district a further £260,000.
The council also backed a county-wide zero percent discount on council tax for homes which are unoccupied or going under significant repair, in another move designed to free up more properties for locals.
Gareth Dadd, the Conservative Deputy Leader of the council, said the aim of imposing the 100 percent premium was to either encourage second-home owners to sell to local people or to use the estimated £14 million that the increase will raise to promote house-building and other measures.
He told the meeting in Northallerton: ‘It is a ground-breaking policy. In many ways, we have led the way.’
Mr Dadd said: ‘I support this not because I support greater taxation but because I see the real challenges for local people in finding affordable housing.’
He said the money that this measure could raise ‘could be transformational’.
The National Housing Federation’s chief executive Kate Henderson said: ‘There is a chronic shortage of truly affordable homes in rural areas, and where people can’t afford to live, they can’t afford to work, which ultimately damages rural growth and productivity.
‘I’m glad to see that the revenue raised from these measures will be directed to providing the homes that communities sorely need.’
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