Wednesday 27th April 2022

(2 months, 1 week ago)

Westminster Hall
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[Stewart Hosie in the Chair]
14:30
Selaine Saxby Portrait Selaine Saxby (North Devon) (Con)
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I beg to move,

That this House has considered the availability of affordable housing in Devon and Cornwall.

It is a pleasure to serve under your chairmanship, Mr Hosie. I hate the word “crisis”, but there is no doubt in my mind that we have a housing crisis across Devon and Cornwall, which is particularly acute in my constituency of North Devon. It means that there is virtually no housing available for local people, affordable or otherwise. This weekend, the Chamber engagement team secured over 200 responses, the strength of feeling is so high. It is my constituents’ experience of this issue that drove me to apply for today’s debate.

Carol, one of my constituents, says:

“For me personally I am a single woman two years off retirement, I will not be able to retire completely because private rents are too high for one person on a pension. I am at risk of being homeless because of this. I’m not eligible for help if I lose my house because I cannot afford to live here anymore.”

Rachel says:

“We’ve been given notice to move out after 10 years so our landlord can use the house for family holidays. But we cannot find another family home in Braunton—there’s simply nothing available, likely due to the increased number of holiday lets.”

Kathryn says:

“We were saving to buy a house 3 years ago, unfortunately having reached our savings target 18 months ago, we have been unable to buy due to the huge increase in house prices in North Devon during the last 2 years. We now require more than double our original savings target for a deposit so are stuck renting until something changes.”

Stephanie says:

“Despite working, two of our children who live in Devon with children of their own are now suffering poverty due to high and increasing rent and no possible chance of either social housing or owning a home. They are likely to need deposits of approximately £150,000 as their wages would only cover a mortgage to approximately £90,000. It’s no good claiming there are schemes where only 5% deposit is needed when house prices far exceed earnings.”

So what exactly is going on? Figures from the Land Registry show that house prices in North Devon have risen by 22.5% against a UK average of 8%, the second highest increase in England, with neighbouring Torridge coming in fifth at 19.9%. At the same time, we have seen a complete collapse of the private rental sector as landlords take advantage of the surge in domestic tourism during the pandemic. Currently, Barnstaple, with a population of over 35,000, has just three private rentals available on Rightmove and 234 holiday lets on Airbnb.

Geoffrey Cox Portrait Sir Geoffrey Cox (Torridge and West Devon) (Con)
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Does my hon. Friend agree that the situation at the moment allows landlords to buy up good residences in towns such as Barnstaple and Bideford, register themselves as businesses, apply for small business interest rate relief, pay nothing to the community, either in council tax or business rates, and provide very little by way of employment, and that that racket has to be stopped?

Selaine Saxby Portrait Selaine Saxby
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As always, my right hon. and learned Friend and neighbour makes an excellent point. There is so much that needs to be done in Devon and Cornwall.

Building on the point I was making about the availability of property, today Ilfracombe has just one private rental and over 300 holiday lets. Apparently there has been a 67% reduction in rented housing between 2019 and August 2021, making North Devon the worst affected area in the south-west and the fourth worst nationally. Despite an improvement in the management of the list, the council reports a 32% increase in applications, with local affordable housing providers advising that there has been an increase of four to five times in the number of applicants for each new affordable rental property. From the data available, our district council reports that we have lost 467 houses from the permanent occupied market to second homes and short-term holiday lets, at a time when the rate of new developments has dropped right off due to the pandemic.

Simon Jupp Portrait Simon Jupp (East Devon) (Con)
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Does my hon. Friend agree that the Government need to consider a bold policy intervention to tackle the impact of second home ownership? One such policy could be to allow councils to reserve a percentage of new builds for people with a local family or economic connection to an area.

Selaine Saxby Portrait Selaine Saxby
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I agree with my hon. Friend. In my constituency many of these homes are reserved for local people, and I will explain some of the further issues later in my speech. I know that the Secretary of State has conceded that we have not built enough affordable homes, and he is right.

Neil Parish Portrait Neil Parish (Tiverton and Honiton) (Con)
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I thank my hon. Friend for securing the debate. In Cullompton in Mid Devon, we are putting up Zed Pods, which are very good modular homes that are zero carbon and equipped with triple glazing. They are also going on to garage sites and the like, and can be put up quite quickly. If we want to push to get more housing done, that is one way in which we could produce affordable, good-quality housing that is good for the environment and help reduce waiting list numbers.

Selaine Saxby Portrait Selaine Saxby
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That highlights another important point, which is that a large number of small district councils in Devon are all tackling the same issue and coming up with different solutions. In fairness, building rates in North Devon have been good historically. However, we are currently averaging only 18% affordables on each development. As the Affordable Housing Commission concluded in 2020, many of these products are

“clearly unaffordable to those on mid to lower incomes.”

With some of the lowest productivity figures in the country and an abundance of part-time and seasonal work, we clearly have a lot of residents in that category.

Anthony Mangnall Portrait Anthony Mangnall (Totnes) (Con)
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My hon. Friend makes a good point about affordability. Does she agree that it is important to ensure that our county council statistics on average earnings are reflective of what in-county people earn? All across Devon, average earnings per year do not relate to the people who want to be able to afford houses and who work in the same area.

Selaine Saxby Portrait Selaine Saxby
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My hon. Friend makes a good point. That is particularly the case in the south of our enormous county, where people can go out to other places, whereas we up in the north are very much—unless we work in London—in North Devon. Many new builds there are being snapped up as holiday lets or second homes. Many never even make it to market; they are purchased off plan before local residents see the light of day.

Building right down the Devon and Cornwall peninsula is difficult. We have higher land prices, particularly on the north coast, and fewer resources to build and materials to build with, making viability so challenging that the percentage of affordables drops right off. Many of the issues impacting on the housing market at present are particularly extreme on the coast, and we have an abundance of beautiful coast in Devon and Cornwall.

North Devon has an abundance of tiny communities looking to community land trusts, but products that should work well there repeatedly find that the high-unit grant rates required on often challenging sites with high abnormals still have a funding gap of £30,000 per unit, and that is despite the generous registered providers and grant rates from Homes England’s affordable homes programme.

I hope that I have detailed the magnitude and complexity of the problem. I have been walking this road for over 18 months and am grateful to the ministerial team for hearing from me quite so often on this topic. However, what I am struggling to convey is the urgency of the need for a solution.

With summer approaching, we are expecting and, indeed, seeing another surge in section 21 notices, as landlords find ways to evict tenants to enable them to convert these homes into holiday lets. With no registration scheme in place, there is no formal record of how many people are renting properties out on a short-term basis. We desperately need the consultation on the registration of short-term holiday lets to conclude, but it has not even started, despite having been announced last June. The Department for Digital, Culture, Media and Sport assures me that it is imminent, and even Airbnb is calling for one.

Having spent much time with housing providers, I know that they believe that the only solution is to devise another class of planning for short-term rentals, so that councils can differentiate between C3 housing and what would be, in essence, a commercial venture in short-term holiday lets. Local councils could then require licences to run that type of business in a property that was initially built for full-time residency, and limits could be placed in a community if there is deemed to be an imbalance.

We have always welcomed holidaymakers and second-home owners to our beautiful coast, but we have got out of balance, leaving the fabulous pubs, restaurants and hotels that people come to visit—and even our surf schools—unable to recruit enough staff. The situation has extended to our public services, with transferring personnel, however senior, struggling to find housing. With vast distances between so many communities, the increase in the cost of fuel and the absence of public transport, if there are not enough people living close to jobs that are paid a living wage, it is simply not worth travelling to get there in North Devon. We have already seen teaching assistants move out of jobs they love, simply so they can work closer to home. If there are no homes near someone’s job, it leads to jobs being returned, as people simply cannot move into the area.

I believe that we also need to go beyond just tackling business rates on short-term holiday lets; we need to tackle the inequalities between mortgage relief on long-term and short-term rentals, which are viewed as capital assets. Their profits are taxed differently, as returns on capital. Both types of property were built as homes, and they should be taxed comparably. Without a register of short-term holiday lets, I imagine that many are paying no tax at all, which is another opportunity for the Treasury. This is a step that could be taken rapidly to make the private rental sector more appealing to landlords, which is ultimately a step that we need to take quickly in order to begin to provide more housing in the south-west.

Other steps that could be taken rapidly include recognising that Devon has a large number of small planning authorities that all tackle the same challenges, with most having under-resourced planning departments, as detailed in previous recruitment challenges. Will my right hon. Friend the Minister commit to assist our planning departments to reverse building where appropriate, to stop building properties solely for holiday lets or second homes, and to have a clause that exempts people from living there full time? It is one thing for holiday parks, which are designed that way, but actual housing is being built with this restriction in place along the North Devon coast. Clearly that is needed on occasion, but as we have such a shortage of long-term housing, can we not focus on this, given that we are short of the other necessary resources—land, builders and materials?

Will my right hon. Friend the Minister also commit to work with the Treasury to look at taxation reforms and how to tackle the issue of empty properties? We have an abundance of them in North Devon, but it is simply not viable for the council to spend its time and resource on tackling this issue. If we could breathe life into empty buildings, we could take steps to regenerate additional housing, without building all over the beautiful fields of North Devon. I keep being told that the councils have it in their remit to convert space above empty shops into homes. Will someone please come to Barnstaple and make that happen? We have so many empty units with huge storage areas, rather than flats, above them, and tackling this issue could transform our town centre as well as provide vital accommodation.

Finally, please can steps be taken to tackle the issue of viability and barriers to councils being able to build developments with more than an 18% social housing component? I know that we English believe that our home is our castle, but far too many of the residents of North Devon worry about not having a home at all. That causes mental health issues, which are exacerbated further by having so many shortages in mental health services, as we cannot recruit to fill the vacancies.

We get really big storms in North Devon, and we are stuck in a really big housing storm right now. Without urgent intervention, we will have literal ghost towns and villages along our coast next winter, as locals have their homes and opportunities to live and work in their community ripped away from them by something like the Kansas twister. I hope that we can say goodbye to the yellow brick road and that some affordable housing wizardry will be expedited this afternoon.

14:43
Ben Bradshaw Portrait Mr Ben Bradshaw (Exeter) (Lab)
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The hon. Member for North Devon (Selaine Saxby) has admirably outlined the problems that many of our constituencies face. Mine are slightly different from hers, but they carry a lot of similarities. If anything, house prices in Exeter are further inflated by the presence of a very successful university that has grown considerably in recent years due to the fact that the city is an attractive place to live. It is two hours from London on the train, and it is possible to cycle or walk to schools, so Exeter has all sorts of quality-of-life benefits.

My local authority has a very good record at doing what it can to ensure the good provision of local social housing and affordable housing to rent, but it really is working against Government policy all the time, and I have to give the Minister a number of practical proposals from my local authority that would make people’s lives much easier. For example, we are one of the few local authorities in the region that always insists on the maximum legal requirement for social housing in private developments in Exeter. That has made a huge difference, but it is like pushing a boulder up a hill repeatedly—not least given the impact of the covid pandemic. In recent weeks I have been knocking on doors for the local elections—as I am sure we all have—and have been completely dumbstruck by how many people have arrived in Exeter in the last year or so. They have moved out of London and the south-east for a better quality of life and cheaper housing, as far as they are concerned—they can now all work from home—and that is making the problem more acute.

There is a useful thing that the Government could do, according to my local authority. Through the right-to-buy scheme we are losing 40 council homes a year in Exeter. We are building 100 a year, but obviously we would provide a lot more local council houses if the local council was allowed to keep some of its receipts a bit longer. I know that the Government extended the number of years that local councils could keep those receipts to invest in local housing provision. However, because of the current shortage of construction workers and labour, and the difficulty in getting stuff built—I am experiencing that myself as I am currently renovating a house—it would be really helpful for local authorities if the Government had another look and considered extending to 10 years the period in which local authorities can reinvest that money. I do not see what the argument against that would be, as it would make the lives of local authorities a lot easier.

I know that this is a controversial suggestion, but given the seriousness of the situation outlined by the hon. Member for North Devon—this is a serious crisis—will the Government consider suspending the right-to-buy scheme for a limited period? That would protect our stock and enable local authorities to add to it in net terms. Even if private sector rental accommodation is available, in many cases the rents are simply out of the reach of many people, given the incomes they can command in the south-west.

The Minister could also change the way in which “affordable” is calculated. At present, the term “affordable” is applied to a calculation of 80% of the local market value. In Exeter, as in most places in the south-west, that 20% reduction of already hugely inflated prices makes absolutely no difference to the majority of potential homebuyers. The cost price is still way out of the reach of most local people. A resetting of the calculation of “affordable”, using, for example, a percentage of the value above building costs, could really make a difference. It would go a long way towards making “affordable” actually affordable in reality—for most people, that is currently not the case.

The hon. Member for North Devon has touched on the issue of second homes and Airbnbs. That is also really serious and has got much worse in the last year or so. It is unlikely to get better given the continuing demand from people across the UK for domestic holidays. We need an area-based cap, based on the local housing need. A cap on the percentage of housing used for short-term holiday lets needs to be put in place, even if it is a temporary measure for a couple of years in order to redress the imbalance of permanent versus temporary housing.

Planning regulations and houses in multiple occupation regulations need to be changed. Local authorities need greater powers—this is a massive issue in Exeter—so that they can determine the percentage of housing that is permitted for short-term HMO lets based on the housing need in their area. Local authorities need to have the ability to refuse planning permission for flipping family homes into HMOs once that cap is reached. That would make a significant difference in Exeter and, I am sure, in some of the constituencies my colleagues represent.

The final thing that my local authority said would really help to address this crisis in the short term is a two-year freeze on private sector rents, and a fair rent endorsement backed by Government incentives, such as a deposit underwriting scheme, so that local people can afford private sector housing. Many of them cannot at the moment. Those are just five or six practical suggestions that I hope the Minister will take away. I am sure that colleagues present will make other suggestions.

This is the most serious housing crisis I have experienced in my 25 years as a Member of Parliament. The combination of the cost of living crisis, inflation and the extraordinary inflation in house prices, which is more acute in beautiful regions such as the south-west, is creating an unprecedentedly difficult situation for families. I worry that we will see a big increase in homelessness in the months to come unless the Government do something about it very quickly.

14:49
Derek Thomas Portrait Derek Thomas (St Ives) (Con)
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I can only echo all that has been said so far about the challenging situation in Devon and Cornwall. This acute problem particularly affects Devon and Cornwall, and I commend my hon. Friend the Member for North Devon (Selaine Saxby) for securing an extremely timely debate.

The lack of good-quality, affordable housing for local people is not new, but it is not helped by significant population growth. In the past couple of years, Cornwall has had the highest net internal migration of any local authority area in England and Wales. I do not want to say this, but I know it is a fact as I do a lot of work on empty homes in my constituency: the problem is not helped by the fact that the Church of England, the Methodist Church, Cornwall Housing, an arm’s length company of Cornwall Council, and LiveWest, which we all know in Devon and Cornwall, have a lot of empty homes across Cornwall. The Methodist and Anglican Churches have empty homes in my constituency, and I am trying to get them used to address the significant need that hon. Members have set out clearly. Nor is it helped by the fact that long-let homes are being flipped to holiday lets at an alarming rate.

I refer the House to my entry in the Register of Members’ Financial Interests, and to my housing debate in December, when I had more time to set out the difficulties and potential solutions. During the debate, I called—more ambitiously than has been done so far—for devolved powers to local authorities such as Cornwall Council through the levelling up and regeneration Bill. I believe I have the support of Cornish colleagues in suggesting that all new homes be restricted for permanent residents only in perpetuity, and for a licence requirement if someone wants to use a home that is lived in as a holiday let, a bolthole or for any other business purpose.

Since December, the Government have not done a great deal to resolve the problem, although I appreciate that legislation is to be announced in the Queen’s Speech, but they have sought to address the exemption of second homes from business rates and council tax. From next year, as a consequence of lots of work that many have done—I have raised the issue twice in the Chamber over the years, and the Government ran two consultations—people will have to prove to the local authority that they have rented their house for 70 days before they qualify for the exemption. I still think council tax should be paid on all homes built to live in. That would be very good for our police and our town and parish councils, which at the moment are losing that income.

Anthony Mangnall Portrait Anthony Mangnall
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If the Government decide not to take up my hon. Friend’s suggestion, they should extend that 70 days to 140 and make it more rigorous.

Derek Thomas Portrait Derek Thomas
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And stop the opportunities for fraud. At the end of the day, it is fraud for someone to say they have a business that they do not have. I would happily welcome that.

Today, I want to explain why the pressure on housing has intensified in recent months and years. Regrettably, that is in part an unintended consequence of Government policies. I want to pick on two of them. Government policy is effectively driving landlords out of the market. We hear landlords saying—I could use some French, but I am not going to—“We’re not going to do this anymore. We are going to flip our homes into holiday let or do something else with our property,” and they are partly supported by Government policy, such as changes to long-let allowable tax benefits. Since April 2020 —not that long ago—landlords have no longer been able to deduct any of their mortgage expenses from their rental income to reduce their tax bill. The new system means higher or additional-rate taxpayers can no longer claim tax back on their mortgage repayments. Less obviously, the new rules could force some landlords’ total income into the higher or additional-rate tax bracket, depending on their pension or other income. I do not particularly object to that if it is fair across the board, but at the moment it favours holiday lets and does not help private landlords.

Neil Parish Portrait Neil Parish
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I very much welcome what my hon. Friend is saying. We need to set up a rental system that encourages people to have private, long-let properties. We have made a mistake by targeting them too much, taking away the interest rate and the ability to claim that back against the property. We want private landlords who let good quality properties on long-term rentals, so the Government should reverse some of that policy and look at ways to encourage the private sector to put up good properties for long-term lets.

Derek Thomas Portrait Derek Thomas
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I completely welcome and agree with that intervention. I do not believe the Treasury deliberately intended to force private landlords out of the market, but that is certainly what is happening.

Energy performance certificates are a pet subject of mine and a debate on their own. Rental properties now require an E rating, which does not sound particularly ambitious until we try it on a property that was built in the 1800s. Since April 2020, landlords can no longer let or continue to let properties covered by the MEES regulations if they have an EPC rating below E, unless they have an exemption, which is not easy to get and costs over £3,000. The landlord has to spend money on the house before they even apply for the exemption. If they are planning to let a property with an EPC rating of F or G, they need to improve the rating to stay within the law. Again, every landlord has to get an EPC rating of E.

The Government’s plan to make rented homes greener is not in itself a bad thing, although we can have a wider debate about whether an EPC is the right tool to deliver the desired outcome. It is a computer system that invariably says no, without the ability to understand or appreciate the diverse nature of the built environment. I do not object to improving homes, making them warmer and their upkeep cheaper, with less of an impact on the environment, but my concern is that landlords seem to be subject to the EPC requirements in a way that holiday lets are not, and the situation is expected to get much worse because the Government have consulted on a compulsory energy performance certificate rating of C on new tenancies by December 2025—three years from now if they pursue it—and on all rented properties by December 2028. If we think the problem is bad today, it will be disastrous for somewhere such as Cornwall, where buildings were constructed in a very different era compared with today, and I would not even say that our buildings today are that modern. We will not get properties up to EPC rating C, so they will be lost to the rental market.

Those are examples of legislation that applies to long lets, as my hon. Friend the Member for Tiverton and Honiton (Neil Parish) has clearly demonstrated. We are losing valuable homes that people enjoy—we have heard about tenants of 10 years—because the legislation that applies to private landlords does not necessarily apply to people who own holiday lets. I largely agree with the requirements, but I do not believe there is a level playing field. Irrespective of Government policy, we must avoid a situation where we drive private landlords out of the market. There are people who do not wish to own their own home, and there are lots of people who, because of how we manage the term “affordable”, find it difficult to get on the ladder.

I hope the Minister understands the severity of the problem for Cornwall and the Isles of Scilly. It is urgent. I have many constituents in a desperate situation, and we need rapid and effective intervention that provides a secure home for life, whether it is owned or rented.

14:58
Tim Farron Portrait Tim Farron (Westmorland and Lonsdale) (LD)
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It is a pleasure to serve under your chairmanship, Mr Hosie, and I offer massive congratulations to the hon. Member for North Devon (Selaine Saxby) on securing a really important debate. I apologise to colleagues, but I am a Member of Parliament for a western county—[Laughter.]

More seriously, I think we need to hunt as a pack because the issues that affect Devon and Cornwall affect Northumberland, North Yorkshire, Somerset, Wiltshire, Cumbria, Shropshire and other places as well. The hon. Member for North Devon was right to say that we should be sparing in our use of the word “crisis”, but she was right to use it in this case, because there is no doubt that rural communities like ours are under huge pressure. They were before the pandemic, but the pandemic has turbocharged a problem that already existed.

I want to echo something that the right hon. Member for Exeter (Mr Bradshaw) said earlier. The word “affordable” has become almost meaningless in how it is applied. In Devon, Cornwall or Cumbria, a house for sale at £200,000 is not affordable. The reality is that when average household incomes are in the £20,000s and average house prices are at least £250,000, that is a broken system and a broken market. I believe in a free market but I would intervene and referee to try to make it fairer. We are all trying to encourage the Government to take that seriously.

We represent desirable and beautiful places, with great, welcoming communities. We must get the tone spot-on, as we are not saying to people who visit or make their homes in our communities, or even have second homes in our communities, that they are not welcome. We are welcoming, British people—that is what we are. Our communities and economies thrive because of the tourism that underpins them, but we cannot ignore the fact that excessive second home ownership and holiday lets, excessive house prices in general, and a lack of availability of affordable homes for families who are either local or want to become local, are serious problems. We have a broken market, and we have to intervene to fix that.

The impact of excessive second home ownership is the death of communities. When a village or a town lacks the number of permanent residents needed to allow it to support a school, a pub, a post office or a bus route, its community becomes sad and dies as it no longer has any functional existence. No one wants to come on holiday to a dead community. We want to protect those communities so that they are alive and living.

I talked about the pandemic turbocharging an existing problem, but during the pandemic estate agents in my patch reported that anything between 50% and 80% of all house sales in the lakes were in the second home sector, showing a steady attrition of the already reducing permanent housing stock.

Holiday lets are vital and underpin any tourism economy, but if there are too many, where do they come from? In one year during the pandemic, there was a 32% rise in the number of holiday lets in my district council area. They are not being magicked from nowhere, but, as the hon. Member for North Devon rightly pointed out, arise from long-term lets where the landlord has ejected tenants using a section 21 eviction, and they then typically end up on Airbnb and similar places.

In my area, and I imagine Devon and Cornwall are very similar, we have high levels of employment and low levels of unemployment. Typically, we see couples, both of whom have jobs, with children at local schools, having to leave those jobs and take the children out of their schools in order to move to somewhere urban that is just about affordable, perhaps 50 miles away. That kills local communities, is tragic for the individuals and families concerned, and is a massive blow to the life of that community.

That point is worth bearing in mind when we look at new-build homes, wherever we live. There is a danger that we have got into the mindset that fewer planning regulations are better for creating more homes; that is not true. Planning authorities, whether they be national parks or local authorities, have to have the power to direct what kind of homes are built, in order to make them more likely to happen. In this country, we are constantly building to meet demand, but not building to meet need, which is what creates opposition to new development.

In most communities like mine, the people are the opposite of nimbys. They are desperate for new homes, but for homes that people need. Of course, a nice new-build four or five-bedroom property in Cornwall, Devon or Cumbria will sell and someone will buy it, but it is not what that community needs. We need planning laws that make sure that the homes that are built are green, sustainable, affordable and underpin the local community and economy.

Anthony Mangnall Portrait Anthony Mangnall
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Does the hon. Gentleman recognise what the Secretary of State is trying to do through his BIDEN acronym, which means build beautifully, make sure there is infrastructure, hold developers to account, take into account the environment and make sure neighbourhood plans are fully weighted?

Tim Farron Portrait Tim Farron
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Yes. That is massively important, because if a community supports a development, it is more likely to happen. I regret that we do not enforce zero carbon homes and that we still permit the inflation of the value of land through the massively outdated and hugely damaging Land Compensation Act 1961, which inflates the price of houses. Those issues could be tackled by giving local authorities and communities more power, and if better, more beautiful and greener houses are built.

Anthony Mangnall Portrait Anthony Mangnall
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The hon. Gentleman makes an excellent point, with which I wholeheartedly agree. When a planning Bill is introduced, will he support the measures set out in the Planning (Enforcement) Bill, the ten-minute rule Bill introduced by my hon. Friend the Member for Runnymede and Weybridge (Dr Spencer) a few months ago? Those measures were specifically designed to ensure that plans presented to a community or a local council are not altered when the site is developed, driving down the affordability, greenness or environmentally friendly nature of the original proposal.

Tim Farron Portrait Tim Farron
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The hon. Gentleman makes an excellent point, and risks my going off on one about viability assessments and so on, and the fact that when conditions are made, they should be applied. We need the Government to back national parks and local authorities, who impose conditions, get through the planning game and put affordability in there, and then developers say, “We have found some rocks in the field. It will cost too much money to do that now.” We need to ensure that communities get what they were promised and not otherwise. He makes an excellent point.

I will be quick in my final remarks. The impact on communities is huge and the impact on the economy is massive. We had a vote the other night on the amendment on health and social care workforces. In communities such as ours, as has been mentioned by right hon. and hon. Members, we have a serious problem. On the whole, these are older communities. My community is about 10 years above the national average age. That means smaller working-age populations. If those people are squeezed out even further, there is no one to run the health service. People will take jobs in the local hospital or care home, check the housing market and then give back word. That happens all the time, as has already been mentioned.

Cumbria Tourism carried out a survey of members a few months ago and discovered that last year 63% of Lake District hospitality businesses worked below capacity, despite demand being there. Why was that? Because they did not have the staff to meet that demand. That is in part due to the issues that we have raised today. What can we do? Change planning law to make first homes, second homes and holiday lets separate categories of planning use, so that planning authorities and councils can enforce affordability and availability, and ensure there is a limit on the number of second homes and holiday lets in a community. We could allow, as the Welsh Senedd has decided, local authorities to increase council tax above 100% on second homes. Councils would have the choice to do that; they would not have to. As the hon. Member for St Ives (Derek Thomas) mentioned, quite rightly, we should ensure that council tax is paid on every property that is built as a residence.

The simple fact is that a wealthy person, with a second home on the Lizard peninsula or in the Lake District, is subsidised by somebody on the breadline and going to the food bank in the same community because they have let their second home for 70 days a year. That means they pay no council tax and, as a small business, pay no business rate. That is an outrage from the Exchequer’s point of view. It is also morally outrageous, that people barely getting by are subsidising wealthy people who can afford two, three, four or more homes.

We also need to ensure that section 21 evictions are abolished, as the Government promised in their manifesto. We need to decide the point at which a second home has become a holiday let, and raise the bar from 70 nights to more than 100 nights. It could be made consistent with the HMRC requirement of 105 nights a year to qualify as a holiday let.

My final point is this. I agree with pretty much everything everyone has said in the debate so far. We have been raising the matter for years. I remember raising it with the junior planning Minister a few years ago, a gentleman who is now Chancellor of the Exchequer. I am concerned that we make these points, which are obviously an issue, showing the need to tackle the lack of affordable housing in rural communities, yet the Government still refuse to take the action needed to deliver for those communities.

I hope that in a spirit of solidarity and hunting as a pack, we might persuade the Minister to listen and take the action that rural communities need.

15:08
Gary Streeter Portrait Sir Gary Streeter (South West Devon) (Con)
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Thank you, Mr Hosie, for chairing the debate. I start by congratulating my hon. Friend the Member for North Devon (Selaine Saxby) on securing the debate and making her case so forcefully. It is about time that Government realised that one of the solutions to our energy problems in this country is to plug my hon. Friend into the national grid. Her energy could power many homes over the coming months.

I would like to draw the House’s attention to my entry in the Register of Members’ Financial Interests, as a non-executive director of Rentplus-UK Ltd, a company started in Plymouth that provides affordable rent-to-buy homes for local people, especially key workers.

The housing market is complex and challenging. Throughout my 30 years at Westminster, there has never been enough affordable housing to rent or buy to meet demand, and there probably never will be, especially in hotspots such as Devon and Cornwall. Because the area is such a delightful destination, as we have heard, many people seek to retire to our region, pushing prices high, often out of reach of local people. The recent spasm of people selling their homes in cities and moving to the countryside in the pandemic years has exacerbated the problem.

That has resulted in many local people being unable to save the necessary deposit and fulfil their aspiration of home ownership, as recognised in paragraph 43 of the recent House of Lords report, “Meeting housing demand”:

“Given that average deposits are £59,000, ‘saving for a deposit is impossible for many renters on lower incomes’, especially as research before the COVID-19 pandemic showed that 45% of private renters in England did not have enough savings to pay their rent for more than a month if they lost their job…Although it may be the case that preferences have shifted towards renting in the short term as a lifestyle choice, the main constraint on achieving home ownership remains an inability to save the required deposit, a goal that becomes increasingly out-of-reach if house prices rise faster than savings.”

That is exactly what we are seeing. The deposit barrier problem remains a significant challenge in the south-west.

I have maintained an interest in social rented housing ever since I was housing chairman on Plymouth City Council in the late 1980s. As I said, there has never been enough of it—not when councils were the main providers, not under 13 years even of a Labour Government, and not under the last 25 years or so when housing associations have been the main providers.

During those years, there was always a buoyant private sector rented market for those who could not afford to buy and could not access social rented housing. That is an insecure way to live—I would hate to live like that—because renters are at the whim of a landlord who might decide to sell the property and or for whatever reason evict them on just a few months’ notice. But at least there was plenty of it in our region. Many people had a second property that they let out as an additional or retirement income. It was a buoyant market until two years ago.

The impact of covid-inflated prices and the rise and rise of Airbnb have meant that in our region, landlords have been quitting the private rented sector in droves, either selling their property to catch the rising tide or turning their properties over to Airbnb where they can make three or four times the return. That has decimated the market, meaning that many key workers—as we heard from my hon. Friend the Member for North Devon, who led the debate so well—simply cannot find accommodation near their jobs or at all. This unprecedented shift in market conditions is putting enormous pressure on families desperate for a home in our region.

Naturally, the market has responded to scarcity as it always does: by rising prices. A two-bedroom property in Plympton in my constituency, which two years ago would have been £650 to £700 a month is now £850 to £900. When added to spiralling energy costs and council tax always creeping up, many are simply priced out of the market. The housing allowance of £550 has not kept pace.

Derek Thomas Portrait Derek Thomas
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My hon. Friend raises an important point about the housing allowance. The average price in Cornwall of three-bedroom rental is £1,400 a month; does he agree that that is completely out of reach for most working families on an average Cornish income?

Gary Streeter Portrait Sir Gary Streeter
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I do agree. People used the word “crisis” earlier—none of us likes to use it, but this is a crisis. Many constituents are struggling to find a suitable home.

I want to add some questions to the others posed to the Minister. Let us be honest: we know this Minister has the intellect and stamina to grapple with these complex problems. What is the Government going to do about this current gross distortion of the private rented market in regions such as Devon and Cornwall to ensure our constituents can access reasonably priced housing? Is he having discussions with the Treasury about taxation policy on Airbnb? Is his Department looking at new regulations to ensure that Airbnb standards and safety are at least as high as in the general rented market, to ensure a level playing field? Why has the consultation on these issues taken so long? We are Conservatives and we believe in the market, but where it moves so dramatically and quickly against our constituents, we have to find effective ways to intervene.

On the wider long-term affordability problems, the Government appear to be placing their trust in two main pillars: First Homes and shared ownership, with very little between. I wonder whether the First Homes policy, with an in-built discount to be handed on in perpetuity, will survive the test of time. I must confess that I foresee tremendous problems when owners of their first house have to pass on the discount when they sell it. How will they then make the jump to their second house, which will be priced in the open market? I have never understood how that is going to happen, so I question that policy.

Then there is the continued focus on shared ownership, which few people like and where few people ever end up owning the whole property. It has not delivered the scale of accessible homes that was originally envisaged.

Anthony Mangnall Portrait Anthony Mangnall
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I apologise for interrupting my hon. Friend and constituency neighbour, who is making a brilliant speech on this point. I thought I would remind the House and this gathering of MPs that we have the highest rate of second homes and Airbnb properties in Devon, at 8.2%. My hon. Friend is making a point about how we can help people get on to the housing ladder. Could I add a third suggestion? We should enable people to use their pensions as their deposits to get on the housing ladder, which are then ring-fenced in the value of their house and, if they ever sell it on, can be put back into their pension for the future.

Gary Streeter Portrait Sir Gary Streeter
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My hon. Friend is full of interesting ideas. That is another one, which I am sure the Minister will look at carefully and be sympathetic to.

There is a significant gap in the middle between the two main policy pillars that the Government are currently pursuing, and many of our constituents are falling into that gap. As such, here is a thought for the Minister, with which I will conclude. Will he give some thought to calling a conference or roundtable in the south-west this summer to discuss our challenging housing needs? We could hear from key workers and employers about the frustrations and costs of accessing housing in our hotspot area, from housing providers and landlords about the current landscape, their frustrations, and the things that work and do not work, and from innovative providers of housing how, working together with Government, they might help meet the needs and aspirations of our constituents. Such a collective brainstorm could help find both short-term and long-term solutions to our housing crisis.

The housing market in Devon and Cornwall, whether to rent or to buy, has always been challenging for local people, but in my 30 years, it has never been as bad as it currently is. It is a crisis, and urgent remedial action is required.

15:17
Luke Pollard Portrait Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
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I thank the hon. Member for South West Devon (Sir Gary Streeter)—my constituency neighbour—for those remarks. There is cross-party agreement on this issue that I have not seen from Devon and Cornwall for quite some time, and I thank the hon. Member for North Devon (Selaine Saxby) for her introduction, in which she summed up the problem very well. I am on the opposite side of Devon to her, but the challenges on the south coast are similar. They are all part of the same pattern.

This problem is a frustration for many of us in the west country, because it has been growing for years and years. I like this Minister—I think he is a good Minister—but I also know that Housing Ministers are ticking time bombs who will get replaced at the next inevitable reshuffle. We need to make sure that an impact is made early—not long consultations, not long discussion documents, but action delivered in the near term. That is what I hope the Minister will be able to achieve.

My starting point for this debate is a simple one: every family in the south-west should be able to afford a first home, be it to rent or to buy. However, we are fast becoming a region of second homes, Airbnbs and holiday lets. Our communities are being hollowed out, and that is proceeding at pace. The pandemic is turbocharging the housing crisis in the south-west, but the measures to react to it are not coming at the same pace, so we need to look at this issue again.

Far too many people are on housing waiting lists—nearly 10,000 in Plymouth. Those people are living in overcrowded accommodation, living in bed and breakfasts—not the Airbnbs we have spoken about, but accommodation that is not suitable for long-term occupancy. We need to do something about it that will mean everyone can have a first home.

Plymouth operates the Housing First model. I commend the council, be it red or blue, for adopting an approach that says the first thing we should do for any person who is in crisis or having difficulties is provide a safe and secure roof over their head. I wish all councils would follow suit, but it is a good approach. However, we are running out of roofs to put over people’s heads. We need to make sure that we are building at the right pace and making sure those homes are genuinely affordable. I agree with the remark about 80% affordable not being affordable—that is a simple spin to try to persuade the public that enough action is being taken, when it is not. Eighty per cent. affordable is not affordable, and we must not fall for that. Nor should we believe that the dream of home ownership is available for everyone—that is spin from decades ago. Home ownership is out of reach for the vast majority of young people in the south-west. It is something that is accentuating the brain drain in our region, at the very point when we have an opportunity to seize the potential of the south-west to have more people living there.

The average house price for a first-time buyer in Devon is £258,000, and people need a 10% deposit to get a mortgage. That is £25,000, which is too much for many people on low incomes in the west country, and we need to ensure that there are alternative routes. With more families struggling to pay bills, it makes saving up for a house deposit, be it for the private rented sector or for purchase, so much harder. We have seen a massive surge in houses being purchased to become second homes, which is contributing to the hollowing out of our communities. At the same time, we have also seen people renting a property on the private rented market and being removed under a section 21 no-fault eviction, with the property appearing on Airbnb on the same day as the eviction. It is a good way for landlords to make a lot of money, but it is a bad way to have a sustainable community, and the cost of the family now in crisis falls on the taxpayer. It is completely unsustainable.

The private rented sector in large parts of the south-west has collapsed, and we are experiencing market failure. There is a need for urgent intervention, which we have not seen in the past decade.

Anthony Mangnall Portrait Anthony Mangnall
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The hon. Gentleman is making an excellent speech, and I totally agree with his point, but what we need to do—exactly as my hon. Friend the Member for St Ives (Derek Thomas) said—is look at having covenants on properties that say “primary residence only”. That must be on new builds, but it can also be on buildings that are bought into housing associations or on houses that are sold on the market. We must look at how we can adopt that strategy.

Luke Pollard Portrait Luke Pollard
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I think there is a good route for covenants. As someone whose little sisters work in farming, I know that the agricultural ties on some properties are a really important way to ensure that some people are able to afford to live in a rural area and work in agriculture. However, we know that those agricultural ties are too often being severed from properties, which are then turned into holiday lets or empty homes.

I agree with the suggestion made by my constituency neighbour, the hon. Member for South West Devon, about an urgent housing conference in the south-west. There is a special need for it, because the south-west is experiencing this problem ahead of many other regions, notwithstanding the constituency of our Lib Dem friend from Cumbria, the hon. Member for Westmorland and Lonsdale (Tim Farron). We are hitting this problem first, because we have the highest number of second homes and Airbnb penetrations, but it will come to every other region of England and the rest of the country. Instead of receiving bright ideas from London, let the bright ideas come from the communities that are being affected the most. I think that is an excellent suggestion, which I am sure will enjoy full cross-party support to ensure it works, but there are other opportunities in this space.

As I have badgered the Minister and shadow Minister, they will know that the proposals for a First Homes not Second Homes campaign that I have worked up with colleagues from Cornwall and across Devon put the policy emphasis on ensuring that everyone can afford a first home. We need to have a principled moral stance on home occupancy, and I hope the Minister will look carefully at Devon and Cornwall’s devolution proposals on what additional powers over second homes and Airbnbs could be included in our devolution deal to ensure that we are better able to take that on board.

The personal stories are harrowing. Ellen from Plymouth told me that she and her seven-month-old daughter have had to flee domestic violence and be placed in a hotel, but there is building work outside from 8 am to 8 pm. It is simply unaffordable for her to move into the private rented sector, and there is no social housing available in her band. Colleagues from Cornwall have also shared stories of working people who are unable to afford the rent increases this year and who are now facing homelessness or the need to move out of our region.

There is one case that I have been working on for many years, which is about the lack of not just affordable housing but accessible housing for those with disabilities. The problem is especially acute in a city such as Plymouth, where our housing stock is already compressed. It might be possible to accommodate a person with a disability in a one-bedroom flat—we have a few of those—but if they have a family, as many of them do, they are not able to access accommodation, because it simply does not exist. There is no vehicle for their accommodation to be built and funded, so they sit in no man’s land in perpetuity, which is simply unacceptable.

I agree with nearly all the suggestions that have been made so far. The First Homes not Second Homes campaign has been picking up some of the suggestions that are not always in the public domain. I would like the Minister to consider allowing local councils to quadruple council tax not just on empty properties, but on second homes. The Welsh Labour Government introducing that 300% council tax on second homes is, I think, an interesting pioneer project here. I would encourage the Minister to look at it, notwithstanding the difference between party colours, because we must get this right.

Our communities are being hollowed out by second homes. That means looking at how they are getting hollowed out. I would like the Minister to look at the enforcement of covenants on right-to-buy properties. Councillors Jayne Kirkham and Kate Ewert, two Labour councillors in Cornwall, have been pressing Cornwall County Council to ensure that covenants on right-to-buy properties, which exclude those properties from being used as holiday lets, must be enforced, because far too many of them are being used as such. That, I think, is an opportunity for us to reconsider, and I commend the work that they have been doing.

The First Homes not Second Homes manifesto also deals with the fact that our communities have been hollowed out to the last shop in the village. It is about the bus routes going because there is not enough daily traffic and about the shop not being able to make enough money all year round, even though they might do well in the summer months. There is a real opportunity for that.

My final point is that we must build more homes, but must also retrofit the homes we have. Far too many of our homes—especially in places such as Plymouth—are frankly too poor in quality. Some 43% of the people I represent live in the private rented sector. There are some brilliant landlords in Plymouth but, sadly, a number have let their houses deteriorate, so we must ensure that there is an incentive to properly insulate and secure properties. That will lower the bills, which might make the end product more affordable.

However, we are in a state of housing crisis here. Our market is failing. That is why I look to the Minister for urgent action that can be delivered this year—not some time ahead. I commend the suggestions that have been made on a cross-party basis here today.

15:26
Matthew Pennycook Portrait Matthew Pennycook (Greenwich and Woolwich) (Lab)
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It is a pleasure to serve with you in the Chair, Mr Hosie. I congratulate the hon. Member for North Devon (Selaine Saxby) on securing this debate, on the thoughtful way in which she opened it, and on her tenacity in returning to this issue time and again. I know that she has been highlighting it since she was elected. I also thank all Members who have participated this afternoon. We have had a series of excellent contributions, as well as a range of practical suggestions and questions, which I hope the Minister will respond to.

As many of the hon. Members present will be aware, having taken part in them, this is not the first debate this year to grapple with the issues of access and affordability relating to housing in rural and coastal communities. Indeed, there have been several Westminster Hall debates over recent months in which Members from across the House have raised serious concerns, particularly about the impact of second homes and short-term and holiday lets on the availability and affordability of homes for local people to buy and rent. That, in itself, speaks to the importance of this matter to a great many people across the country, as well as the pressing need for more to be done to address the problem so that we get the balance right between the benefits that second homes and short-term lets undoubtedly bring to local economies and their impact on local people.

It is clear from the strength of feeling expressed in this debate, and in those other recent debates, that there remains a clear view among a sizeable number of hon. Members, on both sides of the House, that as things stand the Government have not done enough, and have not got that balance right. That lack of action on the part of the Government has real consequences. I do not think it is hyperbole to use the word “crisis”, as many hon. Members have done. I think that this is a crisis, particularly as it applies to Devon and Cornwall—but also to other parts of England, as we have heard.

What does that crisis look like? As we have heard, as well as entailing the loss of a significant proportion of the permanent population—and the impact that loss has on local services, amenities and the sustainability and cohesion of communities—excessive and growing rates of second home ownership are, in a great many rural and coastal areas, directly impacting the affordability, and therefore the availability, of local homes, particularly for local first-time buyers. The staggering growth in short-term and holiday lets in many rural and coastal constituencies is having the same detrimental impact, albeit on not only the number of affordable homes for local people to buy, but access to private rentals—as we heard—for those who cannot buy and also cannot secure social housing.

Incidentally, when it comes to the shrinking private rental markets in many rural and coastal communities, the issue is not only of access but of security. Many renters in these parts of the country—particularly key workers—are finding that their landlord wishes to begin using their property exclusively as a short-term or holiday let, and they are evicted as a result. That is yet another reason for the Government—who I must say have failed to bring forward a renters’ reform Bill in this Session, despite promising to do so in the Queen’s Speech—to get on with it and finally introduce the legislation necessary to ban no-fault evictions, rather than delaying matters for another year or year and a half with a White Paper.

What, then, needs to happen to ensure that we make available more affordable housing in Devon, Cornwall and other rural and coastal communities across the country? First, as I have said on previous occasions, there is clearly more that could be done to mitigate the negative impact of excessive numbers of second homes and holiday lets.

When it comes to non-planning levers—primarily taxation—we accept that the Government have taken action over recent years by reforming stamp duty, allowing local authorities to increase council tax to 100% for second homes, and proposing that properties be required to have been let for 70 days in any given financial year to be liable for business rates, rather than council tax. However, there is a strong case for going further. We believe the Government should explore providing local authorities with powers to, for example, introduce licensing regimes for second homes and short-term lets, and giving them even greater discretion over their council tax regimes, perhaps, as my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard) just mentioned, allowing local authorities, as Labour has done in government in Wales, to levy a premium or surcharge on second homes and long-term empty properties if they believe that is what is required in their locality.

I believe there remains a strong case for reviewing whether the current 3% rate of stamp duty surcharge on second homes and the 5% rate levied on non-UK buyers are set at the appropriate level in light of the boom that we have witnessed over the course of the pandemic. When it comes to planning levers, the system does now enable residents to put in place local neighbourhood plans that can go some way to managing second-home ownership rates, but again it is clear that further measures are required. We believe that the Government should explore further changes to planning restrictions and enforcement that might enable local authorities to bear down on excessive numbers of second homes and holiday lets in a way that, if designed well, would not exacerbate the problems of affordability and availability that have been touched on in today’s debate.

Secondly, as well as doing more to mitigate the negative impact of, in particular, second homes and holiday lets, Ministers really do need to start grappling with what reforms are required to deliver the right quantity of new housing in the right places, at prices that local people can actually afford. They need to do so because at present the Government are failing to deliver on this front, both in terms of sufficient numbers of new affordable homes to rent—where Ministers are presiding over a system that sees a net loss of thousands of genuinely affordable social rented homes each and every year—and new affordable homes to buy.

The hon. Member for South West Devon (Sir Gary Streeter) mentioned shared ownership and the first homes scheme. I could spend a long time speaking about the deficiencies of shared ownership as an intermediate model. I gently suggest to the Minister that, like its starter homes forerunner, the Government’s flagship first homes scheme, as a policy, looks to all intents and purposes like it is already an abject failure. Not only is it leading to a significant reduction in the number of social and affordable homes to rent by top-slicing funding secured through section 106 agreements, but since it was first introduced, rising house prices, coupled with a rising new build premium, have already eroded the value of the first homes discount, by my calculations, in almost three quarters of local authority areas.

The simple fact is that the policy does not address the underlying reasons why young people and key workers cannot get on to the housing ladder, particularly in areas with overheated housing markets, such as Devon and Cornwall. Labour is committed to giving first-time buyers first dibs on new homes in their local area, and to establishing a new definition of affordable, set at a rate of 30% of local incomes, rather than the present definition, which is linked to those overheated market rates that we have discussed.

I conclude by saying that this has been a worthwhile debate, and I have no doubt that we will return to this subject once again in the next Session unless the Government decide to heed the demands of hon. Members, including many on their own side, and act quickly on this issue. I very much look forward to hearing from the Minister, both that the Government are minded to do so and precisely what that action will entail.

15:34
Stuart Andrew Portrait The Minister for Housing (Stuart Andrew)
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It is a pleasure to serve under your chairmanship, Mr Hosie. I thank my hon. Friend the Member for North Devon (Selaine Saxby) for championing this cause and bringing this debate before us today. I had literally been in the job for about four and a half minutes when she came hurtling up towards me and said, “I have two words for you.” Those two words were more polite than other words that people gave me—“Second homes,” she said. She has been relentless, as hon. Members have said, in ensuring that, in my head, this is high on the list of issues that need to be dealt with. Hon. Members across the south-west, in other parts of the country and across party have been presenting the real issues that their communities face. They are all incredibly important challenges in the housing sector. I thank my hon. Friend for being a torch bearer for the concerns of her constituents, in particular Carol, Rachel, Kathryn and Stephanie, whose responses she highlighted.

I will start my response with a statement of the obvious: people in communities up and down the country deserve access to good-quality and affordable housing. However, that is not the reality that many people in this country live with. To deliver on that ambition, we should keep a laser-like focus on the need to level up the country by increasing the supply of affordable homes in all regions. We as a Government are acutely aware of the unique set of circumstances that exists in our coastal communities around supply, second homes and the looming effects of climate change.

I believe that we are all in agreement that we need more affordable homes and that successive Governments —of all colours, frankly—have fallen short of that goal. We have made it a fundamental part of our levelling-up agenda so that we can start to rectify that, recognising that it is in our national interest for every community in the country to have a strong supply of high-quality, sustainable housing. Where people live should not limit their access to that supply.

We are making progress. Since 2010, we have delivered more than 574,000 new affordable homes across the country. In the south-west alone, we have delivered more than 63,000 of them. Ultimately, however, we know that we need to build more because, for a variety of reasons, supply has simply not kept up with demand in recent decades.

That acknowledgment underpins the affordable homes programme, which comprises £11 billion-worth of investment designed to tackle the twin issues of affordability and supply. It is the largest investment in a decade, and I am hopeful that my hon. Friend the Member for North Devon is aware that the south-west receives one of the largest allocations from it, with £1 billion earmarked for the delivery of 17,500 new affordable homes across the region.

The programme fits with our determination to turn generation rent into a generation of homeowners. Through the programme, we have said that approximately half of the homes constructed will be for affordable home ownership, supporting aspiring homeowners to take the first step on the housing ladder. The programme will also deliver more than double the number of social rent homes than the current programme, with about 132,000 homes for social rent. I accept that that is an incredibly important element of what we have to do. I am keen, as the right hon. Member for Exeter (Mr Bradshaw) said, that we also explore how we help councils start to build council housing again. The points he made are interesting ones, which I will take away and am happy to respond to in writing, if he is in agreement.

Our aim is to support thousands of hard-working people with funding to help them experience the unique sense of pride that comes with owning their own home. In turn, that will help us to level up parts of the country, such as the south-west, by creating new jobs for homebuilders, small and medium-sized enterprise developers, electricians and plumbers alike. The programme recognises the scale of the challenge in front of us, with major investments to tackle affordability, to re-energise the housing sector and, most importantly, to build back better from the pandemic.

As a Government we also recognise the need to address the impact that the large numbers of second homes and short-term holiday lets has, not just on the local housing market, but on the communities themselves, which all hon. Members have mentioned today. As my hon. Friend the Member for North Devon illuminated powerfully in her speech, that is particularly true in our rural and coastal communities, including her constituency.

I want to be clear: this Government wholeheartedly support responsible short-term letting. We absolutely recognise the economic benefits that that can have in our favourite holiday hotspots, but the benefits should not be to the detriment of local communities. Landlords who let out accommodation on a short-term basis must do so responsibly and in accordance with the law. We are taking action to address the fact that there is such a high concentration of second homes in these regions. I am of the view that it is only fair that owners of second homes pay their fair share towards the local services that they benefit from. It is important to re-emphasise the point about the introduction of stamp duty land tax for those purchasing additional properties, and tightening tax rules for second home owners. Large numbers of second homes should not block the path to home ownership for local people and the measures we have introduced will help mitigate their impact.

As I said at the start, I am aware of the seriousness of the situation. My hon. Friend the Member for South West Devon (Sir Gary Streeter) suggested that I hold a roundtable in his region. He will be pleased to know that I have already suggested that to officials in my Department—I look forward to making those arrangements as soon as possible. I want to hear the suggestions that local partners may have. I want to fully understand the impact that the situation is having on local communities from those who are actually there. I now expect that there will be a million invitations for me to visit each constituency while I am there; I would very much look forward to that.

I want to move on to the planning issues mentioned by some hon. Members. Central to tackling the issues that have been raised is the need to deliver the right homes in the right places. Existing planning tools are already helping. Local plans such as those in the Yorkshire dales can protect a share of housing for local residents. Some communities, particularly in the south-west, have chosen to include policies in their neighbourhood plans to require new open-market housing to be occupied as a principal residence. In addition, section 106 agreements can apply a local connection test to protect a share of new housing for local people. Our first homes scheme enables local authorities to prioritise discounted homes for local people through section 106, with discounts at a minimum of 30%.

We have also made changes to the planning system to meet some of the numerous challenges that hon. Members have rightly drawn attention to. In August 2021, we introduced a new permitted development right that allows buildings in the new commercial, business and service use class to change to residential use. I was interested to hear of the challenges that are being faced; while I am not promising to bring my trowel and bucket, perhaps on my visit to the south-west I can see some of the problems that my hon. Friend the Member for North Devon alluded to. The new right means that a wider range of commercial buildings can make the change to residential use without the need for planning applications; for example, it can apply to the spaces above shops. We have also introduced new permitted development rights to allow two additional storeys to be added to existing buildings such as houses, flats and commercial buildings, to create new homes. Those rights will continue to deliver new homes that might not otherwise come forward through the planning system.

We recognise that there are currently capacity challenges, and we want to ensure that local authority planning departments are equipped and have the right skills to make creative decisions, enabling us to take forward ambitious proposals for levelling up. We are engaging with representatives from across local government, the private sector and professional bodies, to consider ways in which we can ensure that local authorities are equipped to deliver places that people can be proud of and have the skills needed to deliver an efficient planning service.

I want to mention levelling up. I think about levelling up as the tool that exists to prevent the Kansas-style twisters that my hon. Friend the Member for North Devon described. I will not go as far as to say that levelling up is a miracle on the scale of “The Wizard of Oz”—and I cannot promise her that I have my ruby slippers on—but I appreciate the reference. Levelling up is a blueprint that has the potential to transform the fortunes of towns and cities all over the country. My hon. Friend the Member for North Devon was right when she drew attention to regional disparities running through this country like faultlines. Those issues transcend every part of society; they are issues of lack of opportunity, lack of good quality jobs, and of life prospects being diminished by areas’ being overlooked and undervalued.

Across the country, places with proud histories such as North Devon have seen generation after generation leave the area with the promise of a better, brighter future that simply did not feel possible or affordable in the area in which they were living. We need only to look at some of the high streets in communities across the country to see that such places have been taken for granted for too long. Even places such as Devon and Cornwall—which draw millions of tourists and have rich cultural heritages—have, at times, been like a jet plane being powered by only one of its engines. We know it is not enough to simply identify the problem and say we are going to fix it. We need to walk the walk, and our levelling-up blueprint sets out exactly how we are going to do that.

Hon. and right hon. Members have raised a number of points today and I am looking at all those issues. I have heard loud and clear—literally—about such issues from colleagues not just in the south-west, but in the Lake district, Norfolk and other tourist hotspots. I appreciate the way that colleagues have conducted the debate today; it has been useful and interesting to hear all their suggestions. I will take them away and consider them very carefully so that we can try to address the problems that colleagues have raised with me beforehand, have spoken about today and, I am sure, will be causing them to keep knocking at my door in the days and weeks to come.

15:46
Selaine Saxby Portrait Selaine Saxby
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It has been a pleasure to serve under your chairmanship, Mr Hosie. I am delighted to have welcomed colleagues to speak this afternoon and I thank them all for coming. I thank the Minister for his response; the roundtable will of course welcome him to North Devon as the first bid for that trip—[Interruption.] I had already texted.

This afternoon, I really would like to stress the urgency of this issue. We have been talking about it for a very long time, and although we recognise that the Minister is relatively new to his post, we have been here before and we need something to happen this summer. I hope that he will be able to nudge his colleagues in the Treasury and the Department for Digital, Culture, Media and Sport to deliver the other bits of the jigsaw puzzle.

Question put and agreed to.

Resolved,

That this House has considered the availability of affordable housing in Devon and Cornwall.

15:48
Sitting suspended.