Second home owners ‘unhappy’ over Dorset Council’s tax plan

As Dorset Council took another step towards introducing a second home tax, councillors said they had been inundated with emails and letters from many second home owners calling for an exemption from paying double council tax.

Speaking at the Dorset Council cabinet meeting on Tuesday 28th February 2023, the deputy leader of the council Peter Wharf who championed the proposal, said it had certainly created some interest and that was “an understatement”.

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Swanage Bay aerial view
Michael King

Swanage has 1,032 second homes out of a total of 5,722 in the Dorset Council area

Intended to address the housing crisis

The aim of the move is intended to address the housing crisis as part of the government’s Levelling Up and Regeneration Bill. This will allow councils in England to double council tax on homes that are only occupied ‘periodically’ i.e. second homes.

It will also let councils charge a 100 percent council tax premium on homes which have been empty for a year or more.

If the bill receives royal assent as expected later in 2023, the new law would allow councils to start charging second home owners twice as much tax from 1st April 2024.

Dorset Council figures for November 2022

Swanage, which has 18 percent of all the registered second homes in the Dorset Council area is expected to be most affected by the new legislation.

  • Swanage: 1,032 second homes
  • Purbeck including Swanage: approximately 2,000 second homes
  • Dorset Council area: 5,722 second homes
Graeme Neale speaking at Dorset Council meeting about second homes
Dorset Council

Graeme Neale who owns a second home in Swanage made his point

“Are we to be penalised just for having a home where we would really love to live permanently but cannot?”

At the beginning of the meeting when members of the public were allowed to speak, Graeme Neale who owns a second home in Swanage explained how he contributed to the local economy and joined in the local community. He asked the council to consider his situation:

“Whilst I would quite happily move down to Swanage from Harrow permanently, it is, unfortunately, not an option. Although I am retired, I have an ageing mother-in-law living near us in a care home and a brother who suffers with Asperger’s syndrome living in local care facilities.

“I also now have a 24 year old daughter who still lives with us, as she cannot afford to move away from home, and needs to commute to London for her work…

“I understand from the proposals that second home owners can be exempt from paying the additional council tax by transferring their properties to business rates as holiday lets, and evidencing that alongside having their property available for let for at least 20 weeks in a year.

“It must also have been actually let for at least 70 days. But I spend way in excess of that time myself in my second home each year but there is no exemption for me.

“So my question is; will the council make any provision for people who love this part of the country, spend considerable time and money here but for very good reasons cannot permanently move here, or are we to be penalised just for having a home where we would really love to live permanently but cannot?”

Councillor Peter Wharf
Dorset Council

Councillor Peter Wharf (right) speaking at the Dorset Council cabinet meeting

“Exemptions cannot be sought on personal circumstances”

In response, councillor Peter Wharf who represents West Purbeck was clear:

“I have received many, many emails and correspondence – a good number from second home owners who have concerns about affordability, have expressed their love of Dorset as an area and provided different reasons and backgrounds for why they have second homes and why they are unhappy about this legislation and would seek some sort of exemption.

“I’ve asked if there can be exemptions based on financial backgrounds, properties being left in wills and a whole host of other reasons.

“Ultimately, if the property is no one’s sole or main residence and furnished, it is a second home and exemptions cannot be sought on personal circumstances.”

Affordable housing at Compass Point in Swanage

Demand for more affordable housing like these properties in Swanage

“Chronic need for additional affordable housing”

The increase in council tax for second homes is estimated to bring in around an extra £9.5 million a year for Dorset Council.

According to Dorset Council there are about 3,700 people on the housing register in Dorset, with a further 2,000 waiting to be assessed. This has left many people in Dorset unable to find anywhere to rent, let alone be able to afford the cost on a local salary.

Peter Wharf continued:

“We have thousands of people on the housing register, people in temporary accommodation and B and Bs. And there remains a chronic need for additional affordable housing and rental properties…

“While I genuinely empathise with many of the second home owners that have been in touch with me, this enabling legislation will allow Dorset Council to start to address some of the housing challenges we face and raise revenue that can clearly be invested back into services for Dorset.

“Many people feel very passionate about the lack of access to housing and I’ve also had considerable correspondence to this end as well.”

Council tax evasion

Opening up the debate to the chamber, councillor Beryl Izzard who represents Wareham was the first to speak. She asked whether a couple with a second home would be able to claim that they each owned one property and could avoid paying the council tax premium?

Dorset Council’s head of revenues and benefits, Katie Hale replied that this would not be likely as the council had access to “significant data matching” that was carried out regularly, as well as a very active inspections team.

Corfe Castle
ANDREW PM WRIGHT

Corfe Castle works hard to maintain a thriving community below the famous crumbling ruin

“To own a second home is a privilege”

Councillor Les Fry who represents Dorchester West said he supported the proposal:

“To own a second home is a privilege. We have people in this county who do not have a first home… As a council we have a duty to all our population to raise all the revenue we can and look at all the avenues we can and we would be remiss if we didn’t.”

“They’re welcome to be here – we’re just asking them to pay a little more”

Speaking up for some second home owners, councillor Sherry Jespersen who represents Hill Forts and Upper Tarrants said that the perception that they can be a drain on Dorset Council and the community wasn’t always correct. She said:

“I appreciate that this is the case in some parts of Dorset but I would just like to acknowledge that many of the second home owners that live in my ward and have written to me – they do make a considerable contribution to their communities.

“They are highly respected friends and neighbours and I wouldn’t want any of the language we use to demonise them as second home owners. They’re welcome to be here – we’re just asking them to pay a little more.”

Worth Matravers duck pond

The picture postcard Purbeck village, Worth Matravers has a high percentage of second homes

“Help mitigate the damage caused by second homes”

Concerned with the pressure on housing and the impact that the lack of affordability has on essential workers, councillor Andrew Kerby who represents Winterborne North said:

“Housing is a finite resource – we know that – especially in Dorset. Our natural beauty limits how much can be built and in Dorset we have some of the largest disparities between income and house prices.

“Unfortunately it disproportionately affects our low paid key workers and first time buyers. This pushes out our economically active and we have shortages in our key industries including the care sector…

“By increasing our council tax, we can help mitigate the damage caused by second homes. Additionally by providing a deterrent we can help persuade people from purchasing second homes, placing less pressure on our housing, less pressure on our countryside, supporting our industries by providing a workforce and supporting local business by providing an all year round income.”

An aerial view of West Lulworth Village looking down to the cove

The beauty of Lulworth Cove attracts many second home owners

“I felt it first hand growing up in rural Dorset”

Concluding the discussion, councillor Laura Beddow who represents West Purbeck commented that as a former Purbeck District councillor, along with councillor Peter Wharf, she had undertaken extensive research into the impact of second homes on local communities. She said:

“There is an impact. I felt it first hand growing up in rural Dorset. We need to take responsibility – the demand for a piece of work (legislation) such as this has been years in the making.”

Vote was in favour

The proposal was passed unanimously.

Out of the 10 cabinet members, four had to declare a conflict of interest as they owned a second property in Dorset.

This meant that the leader of Dorset Council councillor Spencer Flower, councillor Gary Suttle, councillor Graham Carr-Jones and councillor David Walsh had to leave the room during the discussion and could not vote.

Before the proposal can be fully adopted by Dorset Council, it now has to be voted on by the full council at its meeting at 6.30 pm on Thursday 30th March 2023.

Watch the Dorset Council cabinet meeting

The second homes tax debate starts at 2:15:00

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