Council introduces 200% tax for second homes

Martin Shipton

A local authority has defended its decision to charge the highest rate of second home premium tax in Wales - even though just 60 homes will be affected.

Responding to concerns that locals were being priced out of the housing market by outsiders buying second homes, the Welsh Government introduced legislation that allowed councils to charge higher rates of council tax on such properties.

From the start of the new financial year in April, Bridgend County Borough Council (BCBC) - whose area includes Porthcawl - will raise the premium tax rate to 200%.

For a typical council tax band C. one-bedroom apartment, that will trigger an annual bill of around £7,000.

A second home owner in the county borough who doesn’t wish to be named said: “The original consultation on second homes in February 2023 resulted in 53% of respondents not agreeing with the proposals for a 100% increase for all properties classified as second homes, rising to 200% in 2026.

“This led to further consultation and the BCBC cabinet then made the decision on the basis of an additional report in September 2023.

“Councils in Wales have the power to implement council tax premiums on second homes under the Housing (Wales) Act 2014.

“The guidance issued by Welsh Ministers states that the powers were designed as discretionary to allow local authorities to tailor their use to address local priorities and reflect the different patterns of housing availability and need across Wales. When exercising that discretion local authorities are asked to consider the numbers and percentages of long-term empty properties and/or second homes in the local area. The intention of the Act is to address areas where there are a large number of second homes lying empty for lengthy periods and preventing locals from having the opportunity to pursue/live in a property in their community.

“This of course applies to long term empty homes but BCBC has one of the lowest count of second homes in Wales, currently standing at around 60 properties. Therefore second homes in Bridgend have very little, if any, impact on housing stock or homelessness in the county.

“The cabinet minutes of the decision focus solely on financial gain, not the purpose of the act or the premium charge.

“It was mentioned in the cabinet meeting of September 2023 that there were concerns that second homes could increase if the Porthcawl regeneration proceeds. However, the Welsh Government allows BCBC to take account of the prevalence of second homes when considering local development plans.

“This gives BCBC a mechanism to regulate the number of future second homes via planning permission, therefore reducing the risk of high numbers of second homes from now on. This was not mentioned in the meeting in September 2023.

“Furthermore BCBC intends to increase the charge from 100% (double) to 200%(triple) from 2026. Why so high? There doesn't seem to be any science or methodology behind this decision, which will make Bridgend the highest charging council in Wales despite having one of the lowest number of second homes.

“Even Pembrokeshire County Council has deemed 200% untenable, and they have one of the highest numbers of second homes in Wales (3940). They reduced their rate to 150% and recently to 125% for 2026, as they saw 200% as too high.

“BCBC leader John Spanswick has told me it’s a discretionary decision taken three years ago and he has no intention to propose a change. He was unable to give me any methodology and reason behind this hike.

“Surely charging the highest tax in Wales with the fewest number of second homes is not in line with the sprit or intentions of the Housing (Wales) Act 2014.

“I acknowledge I have a second home and am required to pay a premium, but it should not be 200%. This is way too high and not the going rate. I am trying to get BCBC to take it to full council to freeze it at the current rate of 100% in line with other Welsh local authorities for 2026 onwards.”

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A council spokesman said: “The Housing (Wales) Act 2014 enables councils in Wales to implement council tax premiums of up to 300 per cent on long-term empty properties and second homes, and to invest any additional money raised through these charges into supporting local housing needs.

“In setting the premium at 200 per cent as part of a staged increase, the council is exercising its rights under the terms of the Act in order to boost funds for local housing and homelessness services.

“The initiative forms part of a wider plan to address Bridgend County Borough’s local housing needs by bringing long-term empty properties back into residential use, and we have ensured that property owners have been kept fully informed throughout the entire process.

“As well as supporting the purchase of houses for multiple occupation which can be used to accommodate homeless people, itis encouraging greater permanent residency, supports local sustainability, and helps to make local housing more accessible and affordable for our residents.”

Council Area Number of Second Homes Premium Council Tax Rate Gwynedd 4,758 150% Pembrokeshire 3,940 150% (200% in 2024, 125% from 2026) Cardiff 3,225 100% Isle of Anglesey 2,236 100% Ceredigion 1,788 150% Swansea 1,624 100% Conwy 1,384 150% Powys 1,376 75% Carmarthenshire 1,000 100% Neath Port Talbot 486 100% Vale of Glamorgan 449 100% Rhondda Cynon Taf 434 100% Denbighshire 422 150% Flintshire 269 100% Merthyr Tydfil 257 100% Caerphilly 244 100% Monmouthshire 184 100% Bridgend 60 100% (200% from 2026) Newport 12 100% Torfaen 8 0% Wrexham 0 50% Blaenau Gwent 0 0% Wales (total) 24,170 —