Holiday Homes, Social Housing and the Welsh Language: Dyfodol i’r Iaith’s Recommendations

 In response to the challenge of reducing the numbers of holiday and second homes within Welsh communities, the Welsh Government has offered £2m to Gwynedd and £1m each to Anglesey, Pembrokeshire and and Carmarthenshire in an attempt to alleviate the current crisis.

Dyfodol i’r Iaith is of the opinion that substantial and urgent action must be taken. The Government’s current offer roughly equates to buying or building 24 homes, which is a paltry solution, given the scale of the problem.

Cynog Dafis, a member of Dyfodol’s Board has produced a report which outlines how, in terms of action and investment, to seriously tackle the housing crisis within those areas where the Welsh language is a living community language.

The report suggest a new way* of ensuring that tourism creates a source of income to provide homes for local people and boost the economic development of these areas.

1) A New Source of Income

Dyfodol calls upon the Welsh Government to earmark £200m capital to be mainly spent within the west (Anglesey, Gwynedd, Ceredigion, Pembrokeshire and Carmarthenshire) where the housing crisis is at its worse and the blow to the Welsh language felt most keenly. Roughly speaking, this should allow for 800 homes to be bought or built.

These houses can then be used in two ways:

• As social housing to respond to local needs, with the option of part-ownership
• As holiday let properties in public ownership

Profits from the second category would be used as funding to subsidise social housing and/or to pay for developments benefitting the local community and the western region more generally.

The following arrangements are suggested for the management and administration of the work:

• A Consortium of the relevant local authorities
• The Arfor project, which is set to develop further over the coming years
• Unnos, the body proposed by the Welsh Government for the provision of housing

In the future, transferring the stock to community ventures may be considered, but in the short to medium term, its is important to ensure that the scheme is managed through the public sector.

2 Urgent Action

Dyfodol calls upon the Welsh Government to urgently commission a study regarding the potential and practical obligations of the scheme outlined above. It should be possible to publish the findings of such a study by Easter 2022, before moving ahead.

In the meantime, more can and should be achieved. While the proposal is being researched, adequate resources should be allocated, allowing local authorities to interrupt the market by buying, renovating or building new homes in response to local need.

Dyfodol i’r Iaith fully supports the recommendations of Simon Brooks’s report and looks forward to seeing these being fully put into action.

*The proposal was originally launched last year in articles by Cynog Dafis, published in  Golwg and the Western Mail – (see Appendix). Following this, Dyfodol was given to understand that the proposals were being considered by the Welsh Government.

Appendix

How to make Holiday Homes into a Welsh Asset.

 The debate about holiday homes has been grinding on for decades but the pandemic has injected a new urgency into the situation. What with Brexit and a certain nervousness about frequent foreign travel, there is every reason to believe that holidaying in Wales will become more attractive. The second homes problem, a function of the vast disparity in economic prosperity between the big cities and rural Wales, is set to get much worse.

A flurry of initiatives is now being proposed to deal with what has become a crisis in our rural communities, including those where Welsh is a community language. They include raising council tax on second homes to punitive levels; building more social and “affordable” housing for local people; using planning regulations to limit the percentage of holiday homes allowed in certain communities. There is merit in all of these ideas though none is without its downsides,

What all of them leave out, with the exception of a recent initiative by Gwynedd to purchase a small number of houses for local use, is the existing housing stock and a whole lot of other property likely to become vacant in the near futures: retail space in high streets and a host of redundant chapels to give two examples. How to gain access to these properties for local use is the question, given that purchase and renovation is, for various reasons a relatively expensive business.

The key is to capture some of the undoubted profit that can be made from holiday homes for local community use – in effect to transfer some of the wealth of the big cities to the relatively disadvantaged economies of rural Wales.

I propose that a public or community owned body would purchase property on the market and develop  a proportion as holiday accommodation and the rest for social housing. The former would cross-subsidise the latter.

Herewith an example. A three-bedroom house bought for £200,000 (the current average price of a house in Wales) would be rented for social housing at about £90 a week, giving a gross income of £4,600 a year. Such a house, a desirable but unremarkable bungalow on the Ceredigion coast, is offered at £500 a week which, assuming 40 weeks per annum occupancy, comes to £20,000.

Those are crude figures of course. There would be various on-costs, council tax, mortgage payments, renovation and maintenance and for the holiday home insurance, marketing, hiring and the weekly clean. On the other hand an element of public subsidy and/or community investment might be appropriate. Whatever the case, the scope for cross-subsidy seems obvious.

Who would run such an enterprise? Some options are

• A subsidiary established by a local authority or a consortium
• Housing associations
• Not-for profit community businesses
• A development agency such as Arfor, proposed by Adam Price for the West

Such an initiative would be small-scale and experimental to begin with, learning as it goes. But is there any reason why it could not over time become a significant factor in confronting the crisis and providing for community needs? A single initial organisation could spawn local and regional companies, preferably community controlled, to which stock could be transferred.

There would be multiple benefits.

Welsh communities would be empowered, taking ownership of a section of the tourism business, rather than being victims of market forces beyond their control.

Social housing, including shared and assisted ownership options, would be provided from the existing housing stock, at the heart of towns and villages, rather than segregated in new estates on the outskirts.

There would be a mechanism for upgrading existing housing in terms of quality, energy efficiency and retrofitted small-scale renewables.

Green space would be protected for sustainable food-production, wildlife habitat and leisure.

Hundreds of jobs in local businesses involved in renovation and the supply chain and in servicing the holiday homes, would be created.

Welsh-speaking communities would be afforded some protected from the effects of the constant, unnecessary expansion of the housing stock, often irrelevant to local needs and driven by the interests of outside large-scale developers.

This is currently no more than a concept but I believe it at least merits consideration. The new Welsh Government soon to be elected should commission a feasibility study and if the concept stands up get a pilot project going immediately

Cynog Dafis 25.02.21