Changes to planning legislation and policy for second homes and short-term lets come into force on 20 October 2022
November 9, 2022
On 4 July the First Minister and the Leader of Plaid Cymru announced a range of measures to tackle the issue of second homes and short-term lets in Wales. This has included a land use planning element with the introduction of three new use classes. These changes to planning legislation were consulted upon from November 2021 to February 2022 and have now been agreed, with two statutory instruments being introduced to give effect to these changes, coming into force on 20 October 2022.
What changes to planning legislation have been agreed?
1. Amending the UCO to create new use classes for ‘Primary Homes’, ‘Secondary Homes’ and ‘Short-term Holiday Lets’.
- Amending the existing use class C3 (dwelling houses) to apply where a dwelling house is in use as a sole or main residence for more than 183 days in a calendar year (i.e., Primary Homes);
- Introducing use class C5 (Secondary Homes); which covers use of a dwellinghouse other than as a sole or main residence and occupied for 183 days or fewer in a calendar year.
- Introducing use class C6 (Short-term Holiday Lets); which covers use of a dwellinghouse for commercial shortterm letting not longer than 31 days for each period of occupation.
2. Amendments to the Town and Country Planning (General Permitted Development) Order 1995 to allow permitted changes between the new use classes.
Unlimited changes of use between a primary home, secondary home or short-term holiday let can now occur. However, the permitted development is subject to limitations.
Where local authorities have appropriate evidence, they can issue an Article 4 Direction to remove the permitted development rights for a defined area, allowing them to address localised issues in targeted locations through requiring planning permission to change between the use classes.
The change of use from C6 or C5 to C3 will not require planning permission in any case, particularly in areas where there are localised housing pressures.
3. Amendments to Planning Policy Wales (PPW)
The changes to PPW make it explicit that, where relevant, the prevalence of second homes and short- term holiday lets in a local area must be taken into account when considering the housing requirements and policy approaches in Local Development Plans (LDPs).
In addition to assist local planning authorities with making Article 4 Directions and to simplify and expediate the process, subsequent changes are also being made to the GPDO and related legislation. These changes formed part of the ‘Permitted development’ consultation which took place 16 November and 15 February 2022.
What implications will the changes have on the local community?
Where an Article 4 Direction or localised policies are in place to control second homes and short-term holiday lets, there could be an impact on the local housing market through creating a divide in the market, consisting of a market with houses that could not be sold as second homes, and another market with houses that could be sold as second homes. This could lead to house prices falling and increasing, respectively. It could also lead to problems for homeowners wishing to sell their properties in future due to the restrictive condition in place.
Another concern is that the use of Article 4 directions and locally specific policies in LDPs could displace issues of second homes and holiday homes to neighbouring communities.
What implications will the changes have on the planning sector?
In the short-term, the changes could lead to an influx of applications, lawful development certificates and potential appeals from property owners wishing to confirm the legal use of their properties as a second home or a short-term holiday let. Local planning authorities would also be burdened by additional tasks including evidence gathering, monitoring and enforcement. There is no doubt that these changes will have serious resource implications for local authorities.
Nonetheless, a key aspect of the planning system is to ensure the needs and concerns of local communities are addressed. The impact of second homes and holiday homes on the affordability of housing for local people, in particular younger people, and the vitality of the Welsh language is evident in certain communities across Wales, for example Carmarthenshire and Gwynedd.
We therefore welcome, in principle, measures to address the impact of second homes and holiday homes, provided that there are procedures in place to ensure the housing market in Wales is able to remain fluid and responsive to the supply and demand experienced across the country.
First of all, however, we urge the Welsh Government to explore measures other than changes to planning legislation and policy, such as licensing requirements and Land Transaction Tax (LTT). This would prevent adding complexity to the planning system and workload to already under-resourced local authorities.
Further research should also be undertaken to clarify what constitutes material change of use in the context of primary and secondary homes/short-term lets, and to address scenarios whereby the distinction of the primary home may become unclear (such as where two homeowners in a relationship split their time between each other’s properties), in order to avoid issuing new planning legislation which is effectively unenforceable.