Short-term Lets: Regulation

Debate between Joshua Reynolds and Noah Law

Thursday 12th September 2024 Westminster Hall

[Mr Joshua Reynolds (Maidenhead) (LD)]

It is a pleasure to serve with you in the Chair, Ms Harris. I thank the hon. Member for Cities of London and Westminster (Rachel Blake) for securing this important debate, and I also thank her for making the distinction between homeowners who sometimes rent out their property when they are on holiday and the commercialised industry that has developed. There is a clear distinction between the two, and I thank her for raising it.

Short-term holiday lets have a role to play in boosting the local economy in holiday and city destinations, as has been mentioned by Members already. Until recently, I was the vice-chair of the VisitWindsor partnership, and I saw for myself the benefits that short-term holiday lets can bring to a town, particularly during events such as the funeral of Her Majesty Queen Elizabeth II and the coronation of King Charles III.

In the 19th century, my constituency of Maidenhead, aided by the advent of the railways, became a popular holiday destination and was known as the jewel of the Thames. Today, it is not necessarily the go-to place for a weekend away, but we still have a number of short-term lets, which are not for holidays but instead support UK and global headquarters based in the town. They provide flexible accommodation for employees and visitors who come to the constituency, spend a few nights in a short-term holiday let and use our local facilities, such as the fantastic restaurants and businesses that we have. That is really welcome, but there is too much of a good thing.

The Royal Borough of Windsor and Maidenhead council is one of many up and down the country that is facing rising housing costs, as it is battling to build both affordable housing, and temporary accommodation for people who find themselves homeless—some of whom have been evicted from properties that have made their way to being short-term holiday lets, as my hon. Friend the Member for St Ives (Andrew George) discussed. Some people are being forced to uproot their lives, take their children out of school and give up their jobs to move elsewhere in the country. It is devastating for everyone involved.

We have heard how councils could play a role in what the future looks like, but we have seen local authorities being asked to do more and more with less and less, which has plunged some into financial crisis. In rural areas, the growth of short-term holiday lets is undermining our communities. Key local services such as bus routes, shops and post offices are closing down. The hon. Member for East Thanet (Ms Billington) mentioned being told, “We don’t have any neighbours.” No Member can fail to be moved by that statement. When we hear something like that, I think everyone is clear that something needs to change.

The Liberal Democrats have long argued for local authorities to be given more powers, backed up by proper funding, to control second homes and short-term holiday lets in their area. We would allow local authorities to increase council tax by up to 500% where a home is bought as a second home, and bring in a stamp duty surcharge for overseas residents purchasing properties. In that way, owners who profit handsomely from the tourism business would be forced to pay back into their local communities.

During consideration of the Renters (Reform) Bill, the Liberal Democrats argued for a six-month moratorium on the marketing of a property as a holiday let if it had been repossessed by the landlord on no-fault grounds. Local authorities are key to this, because they know what is right for their area. The hon. Member for Morecambe and Lunesdale (Lizzi Collinge) spoke earlier about a thoughtful, tailored, local approach, which we would welcome.

We are calling for a separate planning class for short-term holiday lets, requiring owners to apply for a change of use and allowing local authorities to set their own numbers.

[Noah Law]

Does the hon. Member agree that for furnished holiday lets that are subject to planning restrictions, it should be possible to register a change of use given the impending legislative changes?

[Mr Reynolds]

I thank the hon. Member for that intervention. We need to make sure that what we do is backed up by funding so that local authorities are able to enforce the changes that are needed. I would not want to see local authorities having changes forced upon them without the finances and manpower to carry them out. We have seen so many cases recently where local authorities have a duty to do something but not the finance or manpower to do it.

We recognise that local authority housing teams have been hollowed out. Local authorities need the support to be able to enforce whatever decisions are made. I am hopeful that the Minister can tell us the Government’s thoughts about that. I think asking local authorities to put time and work into these changes, with the necessary finance and manpower, will be a worthwhile investment, because it is about time we turned the tide that we have seen engulfing our communities for so long.

I repeat that we need to draw a distinction with respect to people who have gone about this business in good faith. We do not want to penalise them, or people who have inherited a property and become second home owners by default. We all know that short-term holiday lets are growing in an uncontrollable manner. That is the thing that we really need to stop, especially where big business is involved, because it can rip out the heart of our communities. Our proposals would give control back to local authorities and communities, because that is where, as Liberal Democrats, we always believe that power should lie.