Selaine Saxby MP North Devon makes a “cris de coeur” on the subject of second homes and the lack of affordable housing in an essay published in a collection by the “liberal conservative” think tank Bright Blue. 

In North Devon the rate of second homes is one in every 21 properties, while in East Devon it’s one in every 23, in Torridge it’s one in every 24, and in West Devon it’s one in every 34. 

Is her government listening or are they all on the gravy train themselves. Has anyone seen Simon Jupp recently? – Owl

“Residents and councillors alike oppose new developments because they feel they will just be purchased and converted into yet more holiday lets, or become second homes, and that many of the properties will simply not be affordable to local residents.”

“Research by the charity CPRE shows that social housing demand is increasing at six times the rate of supply and it will take 154 years to clear the backlog of social housing waiting lists in rural areas at current build rates.”

 Improving access to housing in coastal and rural areas: Selaine Saxby

The housing situation in my beautiful North Devon constituency is not sustainable. There are virtually no houses for local residents to rent or buy. Very few of those that are available are affordable. When we do build homes, the increasing difficulty with viability means a diminishing number are available as affordable homes for local families.

The understandable surge in ‘staycations’ during the pandemic has seen huge growth in the short term holiday let market. One of the biggest increases in house prices in the country is here in North Devon, making home ownership an unattainable dream for far, far too many families. The growth in second home ownership was a problem even before the pandemic, leaving the spectacular surf village of Croyde well over 50% unoccupied through the winter. This issue has now spread along the coast and even inland.

A flurry of section 21 evictions at the end of the pandemic has enabled landlords to take advantage of the far higher revenues available from holiday rentals, which has meant private rentals are hard to find. The rents have gone up and councils are struggling to find long term accommodation for residents. Ironically, councils have been forced to use some holiday parks as temporary accommodation for families.

North Devon is a beautiful and desirable place to live. Yes, we are a tourist destination, and proud of it. We have some of the best beaches in the country and warmly welcome our visitors. Historically, we have always welcomed second homeowners as well. However, our housing market is now out of balance.

The fabulous pubs, restaurants and surf schools our visitors seek to enjoy are all struggling to recruit. As a result, many operate at significantly reduced hours or service offering, making them less viable businesses in the long term. The situation is now so severe it is impacting public services, which are finding recruitment difficult, as anyone wanting to move into the area simply cannot find anywhere affordable to either buy or rent.

In the autumn and stormy winter months, occupancy of holiday lets and second homes drops right off, leaving ghost communities along the coast. The village I live in is now estimated to be about 50% second homes and holiday lets. Through the pandemic, my street had just a handful of the 30 properties occupied for the best part of two years. The impact this is having on local developments is immense. Residents and councillors alike oppose new developments because they feel they will just be purchased and converted into yet more holiday lets, or become second homes, and that many of the properties will simply not be affordable to local residents.

‘Affordable’ in North Devon is certainly not ‘affordable’ for those on the average wage. The percentage of ‘affordable’ properties is lower right down the Devon and Cornwall peninsula because of the high price of land and low availability of sites, materials and workforce. The definition of ‘affordable’ needs revisiting to better reflect local wages.

We need to urgently find solutions to help tackle the imbalance in our housing market to enable more people to afford to live close to where they work. With the high price of fuel and lack of public transport, travel to work is also not an affordable option for many, so proximity is even more crucial.

Devon and Cornwall MPs have met repeatedly with the multiple housing ministers we have had in my short time at Westminster. We have taken our case to Number Ten on multiple occasions and are grateful for the steps that have been taken to begin to tackle what is a very complex issue. Nonetheless, we also want far more to be done.

The Council Tax surcharge on second homes will undoubtedly help by allowing councils to charge double the rate of Council Tax for second homes. The closing of the business rate tax loophole, preventing councils from collecting empty property rates of Council Tax, was also warmly welcomed. However, so much more is needed to begin to deliver real change into the beautiful rural and coastal areas that are so popular with tourists.

We need to go further. For a start, addressing the imbalances in the taxation system and environmental standards between short and long term holiday lets. The tax changes that removed being able to claim mortgage rate relief on long term rentals came into effect at the start of the 2020-21 tax year. But these amendments only affect long term rentals: short term holiday lets have a specific exemption. This playing field needs levelling.

Much needed energy efficiency improvements to properties are again only required in long term rentals. There is significantly greater return and less investment required, to rent a property out to the short term market in areas such as Devon and Cornwall.

Following the Government’s consultation on the short term holiday let sector, it announced, as part of the Levelling Up and Regeneration Bill, that it would deliver a registration scheme for short term lets. This scheme is a real opportunity for tourist destinations to bring balance back to their housing markets. The scheme will give councils more of an oversight of property use in their areas, and is the start of giving communities more control over the planning use for properties that owners are considering turning into short term lets.

Local councils will be able to compile a full register of holiday let properties in their communities and from that determine whether any more are actually needed. Once the register is established properties wishing to become a short term holiday let would have to apply for a change of use, which could be rejected if the housing market was already saturated or out of balance, as our own currently is. When we have such a shortage of affordable housing, we need to find ways to ensure that all new properties coming to the market are available to the people who work locally to live in.

Small rural communities have a host of other challenges to overcome when it comes to housing. These include: no affordable homes in tiny developments; inadequate funding available for community land trust projects; and concern that the reintroduction of right to buy will deter landowners from releasing land to community projects if there is no guarantee that it remains affordable for future generations in that village.

 We need to find ways to enable farms to redevelop outbuildings into homes for their own workers and for villages to build homes for their own families. Housing associations have a vital role to play in addressing this, but development seems to struggle to keep up with the demand. Research by the charity CPRE shows that social housing demand is increasing at six times the rate of supply and it will take 154 years to clear the backlog of social housing waiting lists in rural areas at current build rates.

Whilst the Levelling Up White Paper rightly highlights the need to ensure our communities are beautiful places to live, when you already live, work and have grown up in a beautiful place, ensuring there are enough affordable homes to rent and buy is vital. The White Paper, in truth, does not adequately address the demise of long term rentals, or how we will actually increase affordable properties in rural locations.

In addition, there are concerns about how affordable housing will be paid for in future with the demise of Section 106 agreements. Across the UK, almost 50% of new affordable housing is funded by Section 106. In rural areas that is even more: in Devon, for example, 76% of new affordable housing built in 2020-21 was via Section 106, and for social rented housing this was 86%.

The lack of affordable housing in most of rural and coastal Britain is creating a quiet housing crisis with priced out youngsters moving out. At the same time, more retirement and holiday communities are developing without any of the services or facilities with valuable staff needed by an ageing population in a remote location. The reason our visitors come – our pubs, restaurants, attractions – will be unable to be sustainable businesses with no one left to run them.

We have to find a way to redress the housing market in our most desirable rural and coastal locations to enable every generation to live and work there. After all, villages without amenities rapidly cease to be communities.

[Selaine Saxby MP is the Conservative MP for North Devon and a member of the Work and Pensions Select Committee. Please note that the essay was completed before the 2023 Spring Budget.]