Wales to licence ‘commercial holiday lets’ landlords to help solve renting crisis

Welsh government leaders have revealed radical plans to licence holiday lets in a bid to get tough on the causes of long-term rental shortages.

The region is to introduce a cap on the number of second and holiday homes while bringing in measures to put more homes into common ownership.

As well as a statutory licensing scheme for holiday lets, greater powers for local authorities to charge council tax premiums and increasing taxes on second homes are planned. Local authority mortgages will also be explored.

The Welsh Government has previously confirmed that it will go ahead with tax hikes on holiday lets that do not rent out their properties for more than half the year.

Its consultation sought views on the maximum level at which local authorities can set council tax premiums on second homes and long-term empty properties and the criteria for a property to be defined as non‑domestic, self-catering accommodation.

New criteria

As a result, local authorities will be able to set council tax premiums on second homes and long-term empty properties to 300% from April 2023.

The criteria for self-catering accommodation being liable for business rates instead of council tax will also change at the same time, from 70 to 182 days.

The Welsh clampdown is being mirrored in other regions. In England, a new government study will investigate how short-term holiday lets impact housing supply across cities and coastal resorts, including looking at proposals for checks on premises, a registration ‘kitemark’ scheme with spot checks for compliance on gas safety and a self-certification scheme for hosts.

Meanwhile, new laws in Scotland will require all local authorities to set up a licensing scheme by October 2022.