The second home hotspot of the North Norfolk coast is attempting to tackle the problems they cause by embracing and educating second home owners.
North Norfolk has 2.9% of the UK’s second homes. It is surpassed only by Cornwall (6.2%) and Gwynedd (4.7%) in its popularity. In all three regions second homes are causing the same problems: locals are being priced out of the housing market, and villages become ‘ghost towns’ out of season causing businesses to become unviable.
Video: In the Norfolk Area of Outstanding Natural Beauty (ANOB) house prices have increased by 93% in the past decade, but for locals like John Needham and Tony Whiting it is the effects of second homes on community cohesion that are most damaging.
To lessen the impact of second home ownership, residents of St Ives in Cornwall voted by a majority of four to one to require new build properties to be sold to purchasers only as primary residences under legally binding covenants. Councils in the Lake District, Derbyshire Dales, north Devon and the Isle of Wight are considering adopting similar strategies.
Gwynedd and six other Welsh councils are considering doubling council tax on second homes. Amendments to the Housing (Wales) Act 2014 now enable councils to charge a premium of up to 100% on top of the existing council tax fee for second homes from the financial year 2017-18. Proceeds would likely be invested in the provision of services and affordable housing for local people.
Image: In the most popular Norfolk coastal villages and towns, such as Thornham, Burnham Market and Burnham Overy Staithe (pictured), between 50% and 70% of properties are holiday homes or holiday lets. In St Ives this figure is only 25%.
In North Norfolk, however, bans and prohibitive taxation are being eschewed in favour of a campaign to educate second home owners as to how they can help to sustain their host communities. The Norfolk Coast Partnership’s Management Plan seeks to promote shared understanding between locals and incomers and dispel “a perception of an ‘us and them’ situation – a divide that increases blame and tension while decreasing positive actions and solutions”. Its suggestions to second home owners include:
- Visit your second home as frequently as possible
- Use local tradespeople and shops
- Engage with the local community and participate in community events
Without all the second homes we would be lost
John needham, norfolk local and builder
Research commissioned by Visit Norfolk estimates nearly 60,000 jobs to be directly supported by tourism’ 17% of total employment. With the tourism-related industries being the county’s largest employer, contributing over £2.96 billion to the local economy annually, the majority of locals are stoically acceptant of second homes as a double-edged sword.
“It might be nice to have full-time residents in the cottages rather than all these holidaymakers,” explains Norfolk resident and builder John Needham, “but without all the second homes we would be lost, I’m sure, because they bring in a lot of money and work to the restaurants and shops, to the cleaning ladies, people who do the gardens and to the building trade. Maintaining the cottages certainly keeps me very busy.”
Other locals are, however, less acceptant of the buy-to-let phenomenon. Purchases of second homes for the purposes of investment rather than enjoyment are perceived to be more damaging to Norfolk communities.
Video: “When second homes took off here in the 1970s they were homes not lets and you got to know the owners,’ says retired builder and Hunstanton coastguard Geoff Needham.
Calls for English councils to be given the same discretion as their Welsh counterparts to hike council tax on second homes are unlikely to emanate from Norfolk. It is feared that inflating council tax bills might encourage second home owners to reclassify their properties as commercial holiday lets in order to avoid council tax altogether. A self-catering property available to let for at least 140 days per year is eligible for small business rates. If a let’s annual rateable value is less than £6,000 its owners can currently take advantage of 100% rate relief until 31st March 2017. Rate relief tapers from 100% to 0% on properties with a rateable value between £6,000 and £12,000.
Banning them or further taxing the second homers would be shooting ourselves in the foot
John warham, thornham resident and parish councillor
Such measures could not only have the undesirable effect of increasing the number of holiday lets but also result in less tax being generated from the second property sector. Council tax liability on second homes in Norfolk has already been increased from 50% to 100% since local councils were awarded discretion to determine these rates in 2013.
“Banning them or further taxing the second homers would be shooting ourselves in the foot,” explains John Warham, a resident and parish councillor of Thornham, one of the most desirable villages along the Norfolk coast in which the Coast Partnership’s Management Plan is being enacted. “We have realised, as a village, there is no way that we could exist without embracing the second home owners, so we have gone out of our way to do precisely that.”
The Plan seems already to be having a positive effect in the village of Thornham. Second home owners are more understanding of the concerns of their host communities, and locals report greater contribution being made by the second home owners.
Video: Previous council tax rises have angered second home owners who feel that they contribute more to the area than they take.
The 3% rise in Stamp Duty Land Tax (SDLT) that came into force on 1st April this year is also proving beneficial to the region. Estate agents report this to have dented the buy-to-let market but not to have decreased the demand for second home purchases as a ‘lifestyle choice’.
Video: In April the rate of SDLT on a property with a purchase price of £350,000 increased from 5% to 8%, raising the tax liability from £7,500 to £16,800.
Only time will tell whether prohibition, taxation or education prove the most successful strategy for addressing the problems caused by second homes.