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 keeping with new figures.

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

It’s also one in every of a lot of Welsh councils which costs a 150% council tax premium on such properties, having upped this from 100% in 2023.

The council, Cyngor Gwynedd, stated 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 Building Society’s Wales House Price Index, protecting residential property gross sales within the remaining three months of 2024.

The typical home worth in Wales has remained broadly flat year-on-year and is now £233,194, in keeping with the constructing society.

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

“I’ve 4 grandchildren who had a beautiful time there each summer time and it has been nice, we have beloved it,” stated 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 stated that they had had little curiosity from potential patrons, regardless of dropping the value by £40,000.

“I put it all the way down to all the opposite properties within the village which might be up on the market in the intervening time,” he stated.

Mr Williams believes among the interventions by the council have prompted lots of people to promote, whereas additionally pushing aside potential patrons.

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?” stated Mr Williams.

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

However he stated the value of a second residence was usually “exterior the affordability of the native purchaser”.

“What we have to see is stability out there,” he stated, together with “extra home constructing so far as first-time patrons 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 comparable 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 precipitated the drop in costs in Gwynedd within the yr to December.

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

The council there not too long ago voted to reduce 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 stated 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 stated demonstrated “better shopper confidence” with decrease rates of interest making mortgages extra reasonably priced.

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

Mr Mansfield stated the “sizeable” drop in costs in Gwynedd over the previous yr was mirrored in “among the different coastal areas in Wales”.

He stated the drop might “probably” be defined by “among the interventions which were made within the space round second residence possession”.

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

It stated it launched Article 4 to “acquire higher management over the prevailing housing inventory” and so they have been “constantly monitoring its results”.

It added among the cash raised by the council tax premium was used to allow “the event of recent properties, the creation of supported lodging for these dealing with homelessness and grants and loans to assist native folks safe housing, amongst many different initiatives”.