Landlords will face changes when it comes to renting out short term accommodation in Wales. At the beginning of 2020 it was estimated there would be 24,423 second homes in Wales, in light of this, more than 5,000 people signed a petition in the early part of 2021 calling on the Welsh Government to intervene to help protect and ensure welsh homes are available to welsh residents.
For the past couple of years there has been a debate in the Welsh government about the status of second homes in the country. This mostly revolved around properties that were used as holiday lets or listed regularly on AirBnb. There are multiple reasons why the government wants to bring in reforms to the status of second homes in Wales. These include;
The government has recently passed legislation with these aims in mind to reform how second homes can be used, and the responsibilities of councils in overseeing them in their area. Here we will highlight what these changes will be and how they might affect property owners and landlords;
The use classes available for second homes in Wales are being changed. The first major change being made is the amending of the use class C3 “dwellinghouse”. This category can now only apply to properties intended to be used as a primary home. It can include a person not related to the family residing there including certain domestic employees. The other major change for use classes are the introduction of class C5 (secondary homes), and class C6 (Short-term holiday lets). How these use classes will be assigned is based on time spent there with 183 days of residence per year being required for the C3 “dwellinghouse” class.
Local authorities and councils will now have the opportunity to block or revoke planning permission. It gives them the opportunity to issue an Article 4 Direction to remove permitted development rights. This would mean that planning permission would need to be obtained before changing the use class of a primary home to a secondary home or a Short-term holiday let. There is also a focus to review local taxes such as increasing council tax on empty properties and introducing a tourist tax on short-term holiday lets.
Overall, the Welsh government will be changing and introducing the use classes of properties. They have also given local authorities the ability to block use changes of properties and are looking to give them more tax levers locally.
If you want to talk to a property manager about how these changes may affect your rental accommodation or short term let, please feel free to contact us here.