Wales Holiday Let Rule Changes Threaten Jobs

Brutal short-sighted changes to holiday let rules are putting thousands of tourism jobs at risk, claims a property industry body.

The Professional Association of Self-Caterers (PASC) claims that property owners are selling their rental homes because tax and rule changes have impacted profitability, making their businesses no longer viable.

As the number of holiday homes decreases, the work for 159,000 cleaners, handymen, and other property-related posts that the Welsh Government says rely on them is also disappearing.

While jobs are becoming scarcer, the house prices in Gwynedd, North Wales, have plunged by 12.4 per cent in just 12 months, says the Principality Building Society. Generally, the building society notes house prices are tumbling in most Welsh coastal counties.

Gwynedd - which has thousands of holiday lets - demands that landlords apply for planning permission to switch properties from residential use to a second home or short-term holiday letting.

Fair contribution

The council and Welsh government claim their policies aim to ensure holiday home owners make a " fair contribution" in the towns and villages where they run businesses.

Gwynedd is one of several Welsh councils that charge a 150 per cent council tax premium on holiday homes.

To qualify as a holiday let is now a holy grail for landlords in Wales.

Gaining the definition comes with tax benefits, such as claiming business rates instead of paying council tax. The benefit makes a significant financial difference to holiday let businesses.

The PASC says one farmer encouraged to diversify into offering holiday lets with government grants picked up a £37,000 council tax bill after his business failed to hit the 182-day letting target. Two out of three holiday let businesses expect to fall short of the target this year.

Bed stock under threat

The qualifying letting target used to be 140 days available for let and 70 days actually let. Now, the target is 252 days available and 182 days actually let.

Another tourism problem is that visitors' bed stock is under threat and is likely to shrink further if and when Wales introduces the proposed tourist tax levied at £1 a night on all guests.

Fewer beds mean fewer places for tourists, meaning fewer jobs in businesses that service visitors, explains Nicky Williamson of the PASC.

She said: "Without the bed stock of self-catering properties, we don't have the facilities for tourists to stay. If tourism fails, then the number of people that are employed in tourism will start to lose jobs - the pubs, the cafes. if there's no tourists, they're not going to survive."

The PASC also argues that politicians focus on housing availability and costs for locals without considering the economic contribution that holiday let businesses make to an area and the significant tax and compliance costs they already bear.