Gwynedd home costs plunge as council acts on second properties

Home costs in a county the place the council has launched measures to crack down on second properties have fallen by greater than 12% year-on-year, in response to new figures.

The native authority in Gwynedd, north-west Wales, not too long ago launched a requirement to acquire planning permission to show residential properties into second properties or vacation lets.

Additionally it is certainly one of plenty of Welsh councils which prices a 150% council tax premium on such properties, having upped this from 100% in 2023.

The council, Cyngor Gwynedd, mentioned its goal was to “improve the supply of high-quality, reasonably priced properties for native folks”.

The autumn in worth represents the most important annual drop of any area within the Principality Constructing Society’s Wales Home Worth Index, masking residential property gross sales within the ultimate three months of 2024.

The typical home value in Wales has remained broadly flat year-on-year and is now £233,194, in response to the constructing society.

Tom Williams and his household, who dwell in Lancashire, are struggling to promote the second dwelling they personal in Morfa Nefyn, Gwynedd.

“I’ve 4 grandchildren who had a beautiful time there each summer season and it has been nice, we have liked it,” mentioned Mr Williams, who has owned the home for 20 years.

Mr Williams and his spouse put the home available on the market in April 2024 however mentioned that they had had little curiosity from potential consumers, regardless of dropping the value by £40,000.

“I put it right down to all the opposite properties within the village which can be up on the market in the meanwhile,” he mentioned.

Mr Williams believes a number of the interventions by the council have prompted lots of people to promote, whereas additionally laying aside potential consumers.

Cyngor Gwynedd has been attempting to handle the scarcity of housing for native folks in vacationer areas and has greater than doubled the council tax cost on second and vacation properties.

The council additionally not too long ago launched Article 4, which requires property house owners to acquire planning permission to show residential properties into second or vacation properties.

“I’ve spoken to a whole lot of households who’ve had properties there for generations and so they’re saying the identical factor – how can we stock on with this?” mentioned Mr Williams.

North Wales property agent Dafydd Hardy described the housing market in Gwynedd as “blended”, with native interventions on second properties resulting in “extra properties approaching to the market”.

However he mentioned the value of a second dwelling was typically “exterior the affordability of the native purchaser”.

“What we have to see is steadiness available in the market,” he mentioned, together with “extra home constructing so far as first-time consumers are involved”.

The brand new figures are based mostly on seasonally-adjusted information from the Land Registry, however a whole lot of various factors can have an effect on the image that information finally ends up portray.

Components equivalent to rates of interest, regional job alternatives, interventions within the native housing market by a council and even the variety of transactions can all have an effect on home costs.

It means there’s some uncertainty about what brought about the drop in costs in Gwynedd within the 12 months to December.

Pembrokeshire noticed the second largest annual fall in costs at 8.9%.

The council there not too long ago voted to cut back the council tax premium on second properties from 200% to 150%.

By comparability, Carmarthenshire noticed the most important year-on-year improve in home costs at 9.2%.

The council there’s introducing a council tax premium of 100% on second properties from April.

Iain Mansfield of the Principality Constructing Society mentioned the housing market throughout Wales had proven “resilience” over the previous 12 months.

Gross sales have been up by 28% year-on-year, which Mr Mansfield mentioned demonstrated “higher shopper confidence” with decrease rates of interest making mortgages extra reasonably priced.

“I believe we’re seeing a extra optimistic outlook for these individuals who need to purchase a home in 2025,” mentioned Mr Mansfield.

Mr Mansfield mentioned the “sizeable” drop in costs in Gwynedd over the previous 12 months was mirrored in “a number of the different coastal areas in Wales”.

He mentioned the drop may “probably” be defined by “a number of the interventions which have been made within the space round second dwelling possession”.

Cyngor Gwynedd mentioned “over 65% of Gwynedd’s inhabitants was priced out of the housing market” and tackling the housing scarcity was a “key precedence”.

It mentioned it launched Article 4 to “achieve higher management over the present housing inventory” and so they have been “repeatedly monitoring its results”.

It added a number of the cash raised by the council tax premium was used to allow “the event of latest properties, the creation of supported lodging for these going through homelessness and grants and loans to assist native folks safe housing, amongst many different tasks”.