Three-quarters of English local authorities are reportedly preparing to implement a substantial increase in council tax for second homeowners starting April 2025.
This significant policy shift could effectively double the council tax burden on properties classified as second residences through a 100% premium charge.
Estimates suggest these new premium charges could generate nearly £450 million in additional council revenue annually.
With over half a million second homes currently registered nationwide, the financial implications for both property owners and local government finances are substantial.
The measure follows similar approaches already established in Wales and aims to address housing shortages while generating additional revenue for local services.
According to data reported by the Daily Express, 157 properties in areas including Dorset and Devon will be charged second home council tax of more than £10,000 per year.
This policy initiative arrives against a backdrop of acute housing pressures in many communities, particularly in coastal and rural areas where second home ownership has traditionally been concentrated.
The adoption of these charges extends well beyond traditional holiday destinations to include numerous urban centres and London boroughs, reflecting the widespread nature of housing challenges across diverse geographical contexts.
What councils and doubling second home council tax?
The implementation of this discretionary council tax charge is reportedly across approximately 200 councils (roughly 75%) throughout England marks a watershed moment in how residential property taxation is structured.
Some councils offer a second home council tax discount so if you are unsure if your second home council tax is going to increase you should check with your local council.
Whether a second home council tax reduction is given (and the value of it) is up to each local council.
Approximately 557,000 second homes currently exist throughout the country, with particularly high concentrations in popular coastal regions and tourist destinations.
The geographical distribution of implementing authorities extends far beyond traditional holiday hotspots to include metropolitan areas and London boroughs such as Wandsworth, Camden and Hackney.
Properties undergoing major renovations, those placed on the market for sale, or residences provided by employers may qualify for exemptions from the premium.
These exceptions could create opportunities for avoidance strategies that reduce both the revenue potential and housing market impact of the measure.
Some might convert properties to holiday lets, which typically fall under business rates rather than council tax if meeting specific letting availability criteria.
A change of use in this way could undermine both revenue expectations and housing availability objectives if widespread.
Why are councils doubling second home council tax?
The forthcoming council tax premium represents a substantial policy shift affecting hundreds of thousands of property owners across England.
This widespread adoption demonstrates the appeal of both the revenue-generating potential and the housing policy objectives associated with the measure.
Financial projections indicate the premium could generate approximately £445 million which represents a meaningful fiscal opportunity for local authorities facing budgetary pressures and increased demand for services.
The revenue potential likely explains the broad adoption of the premium despite its potentially controversial nature.
While traditional second home concentrations in areas like Cornwall, Norfolk, Somerset and Torbay are predictably implementing the charge, the inclusion of urban centres such as Bristol and Rochdale illustrates how housing pressures have become a nationwide concern rather than merely a rural or coastal phenomenon.
This widespread implementation suggests local authorities across diverse contexts perceive benefits in discouraging or monetising (or both) second home ownership.
Opinions remain divided regarding whether this represents an appropriate fiscal tool or merely an opportunistic revenue-raising exercise that fails to address fundamental housing market issues.
Arguments for and against second home council tax increases
Proponents of the council tax premium emphasise its potential contribution to addressing housing availability challenges.
As reported by the BBC some second home owners facing a council tax rise may decide to sell up for financial reasons.
By creating a financial disincentive for second home ownership, supporters suggest the measure could encourage some owners to sell properties that remain vacant for significant portions of the year, potentially increasing housing stock for local residents.
This perspective frames the council tax premium as a market correction mechanism rather than punitive taxation.
With local authorities facing substantial financial pressures, the additional income could support essential services benefiting permanent residents who experience year-round demand.
This perspective suggests second homeowners should contribute proportionally more given the impact their property ownership has on local housing markets and community sustainability.
From a community cohesion standpoint, advocates suggest the premium acknowledges the social costs associated with high concentrations of occasionally occupied properties.
Areas with substantial second home ownership often experience seasonal population fluctuations that can undermine service viability, community institutions, and local economic stability.
The premium potentially recognises these externalities and attempts to create a more balanced approach to property taxation.
Elliot Keck from the TaxPayers’ Alliance states that the increase on second home council tax is: “a very naked cash grab. If you have a second home in an area that you use for only a couple of months a year, you’re actually using services much, much less than if that was someone’s primary property. So, if anything, really you should actually be getting a discount on your council tax, not a premium.”
Some housing campaigners criticise the premium for not going far enough to address fundamental housing affordability issues.
Cath Hayes, co-founder of First Not Second Homes in Cornwall, suggests doubling council tax represents an insufficient deterrent for affluent second homeowners.
