The owners of second homes in North Yorkshire have been warned a strict policy will be enforced to ensure that they pay a new council tax premium as plans are due to be discussed to use funds raised to tackle a critical lack of affordable housing.
We were one of the first authorities in the country to announce plans to introduce a 100 per cent premium for council tax bills on second homes, which will now come into effect from next month (April).
The new scheme will effectively double council tax bills for second homeowners and is due to raise more than £10 million annually with hundreds of new affordable homes set to be built over the next four years.
Members of our executive are now due to discuss a programme of housing initiatives that would be funded through the revenue generated by the premium.
The executive will be asked to approve plans to establish an affordable housing delivery fund and a rural housing delivery fund when its members meet on Tuesday next week (18 March).
Deputy leader, Cllr Gareth Dadd, whose responsibilities include finance, said: “The county is such a wonderful place to live and visit, but this creates very significant pressures on the availability of housing, especially affordable homes.
“We will work closely with the Government, whose Valuation Office Agency is responsible for assessing if a property is a second home, to keep a close check on properties that are second homes and therefore qualify for the council tax premium.
“This is a new policy, but it is one we are totally committed to, and we will be making sure that those homeowners who have to pay the premium actually do so.”
Rural and coastal communities in North Yorkshire are particularly vulnerable to a lack of affordable housing as second home ownership and holiday lets drive up private rent and house prices.
The delivery of new affordable homes in countryside areas is also challenging as construction costs are exacerbated with limited access to local skills, labour and the supply chain.
While about 800 new affordable homes have been developed each year across North Yorkshire over the past decade, there is still a lack of properties to meet demand.
According to figures from the National Housing Federation, there are more than 8,000 second homes in North Yorkshire - the highest number in the Yorkshire and Humber region.
The introduction of the council tax premium is ultimately aimed at bringing second homes back into use for local communities after many people have been priced out of the housing market in some of North Yorkshire’s most desirable locations.
The premium will provide a multi-million pound boost to finance council priorities, including a central aim to use the funding to help introduce more housing in areas particularly affected by the affordability crisis.
Leader, Cllr Carl Les, said: “One of the biggest challenges we face in the county is a lack of affordable housing, and we are committed to doing all we can to allow people to live in the places that they wish to.
“This is a vital means of raising much-needed funding that will allow us to develop hundreds of new affordable homes, targeting the areas of North Yorkshire where the properties are needed the most.”
Under the plans due to be considered by the executive, it is expected that a total of £42.4 million would be generated from the council tax premium over the next four financial years.
Funding raised over the next four years would see £12 million committed to the affordable housing delivery fund.
Over the same period, a further £4 million would be allocated to the rural housing delivery fund and another £4 million would be earmarked to support the development of community-led housing.
A further £4 million is set to be allocated as capital funding to develop bespoke affordable homes, including properties adapted for disabled people along with supported housing.
Another £2 million is due to be used for schemes including regeneration projects and £4 million would be set aside to develop a supported housing scheme on the coast for people with complex needs who have a history of rough sleeping.
It is hoped that about 540 extra affordable homes would be developed over a four-year period along with a 20-bed supported housing scheme on the coast.
Another £12 million is set to be used to develop a commissioning framework for supported housing.
Capital investment raised through our tax premium is expected to see up to 400 new affordable homes delivered over the next four years.
A report to the executive has also recommended that £100,000 each year is allocated as revenue funding to bolster the council’s enforcement work to help improve housing conditions in the private rented sector.
We are also set to work alongside the Government’s housing agency, Homes England, and the York and North Yorkshire Combined Authority to maximise the use of available grants and to deliver shared objectives to introduce more affordable housing.