Second home stocktake

6 April 2011

A house

Shelter is calling for the council tax discount for second home owners to be abolished.

Our new report, ‘Taking Stock’, which looks at ways to maximise England’s existing housing supply, shows that ending the discount for the 252,000 second homes nationwide would raise up to £42 million.  This could be invested in new homes to help address the country’s escalating housing crisis.

The report also proposes that councils are given powers to set council tax higher than the standard rate for properties that are rarely in use.

Download 'Taking Stock'

Second home ownership has grown dramatically since the 1990s, particularly in rural and coastal areas such as Cornwall, Norfolk and Cumbria where some communities claim it pushes up house prices, making property unaffordable for local people.

Currently councils can reduce council tax for second home owners by a maximum of 50 per cent, which is offered by one in five local authorities across the country. Four in five offer a discount of 10 per cent.

Shelter’s Chief Executive Campbell Robb said: ‘Our housing crisis has never run deeper, with millions on waiting lists and increasing numbers of young people unable to get on the housing ladder in their local area. But with government cuts of more than 60 per cent to the budget for new homes, we need to explore every possible way in which existing housing stock can be used to ease our desperate shortage of affordable homes.

‘The council tax discount is effectively a tax break for people with second homes which often lie empty for large parts of the year. Enabling councils to respond to local housing pressures and charge the full rate of council tax, or higher, would mean they could raise vital revenue that could be used to deliver affordable housing for local people.’

The report also explores some of the barriers in using other forms of underused housing stock, such as long term empty homes and those which are under-occupied, to meet housing need.