Second homes surged in popularity during the pandemic as those who couldn’t holiday abroad looked for a bolt hole in Britain. The tide has now firmly turned, however, with the share of applicants seeking to buy a second home dropping to a record low.
In the first quarter of 2025, only 0.6% of applicants registering to buy a property in Great Britain were looking for a second home. That is half the figure seen in the third quarter of 2023 and down from 2.0% in the spring and summer of 2020.
The decline is most pronounced in coastal areas, where second-home purchases are most prevalent. In the first three months of this year, just 1.3% of applicants sought a second home, down from a peak of 4.5% in the second quarter of 2020, when pandemic travel restrictions boosted the popularity of staycations.
Of the 20 most popular hotspots for second-home purchases in 2019, before Covid hit, all have seen a marked decline in buyer appetite. Back in 2019, Norwich, in Norfolk, was the most popular location for second homes, with 13.2% of applicants in the area looking for this type of property.
However, Norwich has seen the biggest drop-off in demand, with only 1% of applicants over the past 12 months looking to buy a second home. This means that there are now 97.9 movers looking to buy there for every potential second homeowner, up from a ratio of 6.1 back in 2019.
The second-biggest decline in demand is in the Forest of Dean, in Gloucestershire. Here, just 1.7% of applicants over the last 12 months were looking to buy a second home, down from 11.4% in 2019.
While second-home demand has weakened in all 20 hotspots, Aberdeenshire and Kensington & Chelsea have seen the smallest falls (of 2.7% and 3.1% respectively). In these areas, the purchase of a second home is more likely to be driven by the need for a pied-à-terre, rather than a holiday home, which may explain why demand has proven slightly more resilient.
Also, Kensington & Chelsea is popular with international buyers, who purchase homes in the area for several different reasons and are unlikely to be as influenced by the harsher tax environment on these properties, notably higher stamp duty land tax and council tax rates.
In the October Budget, the Chancellor increased second-home stamp duty from 3% to 5% and from 1 April it’s expected that around three-quarters of local authorities in England will use new powers to crack down by introducing a 100% premium on council tax for second homes.
The move, which can be charged on properties that are furnished but not used as someone’s main home, means that average bills will rise from £2,280 to £4,560, and comes on top of a 5% rise in average council tax bills, which is also due to come into effect in April.
Our analysis of council data suggests that 71% of England’s 371 local authorities have voted to implement the second-home charge from next month, adding more than half a billion pounds to total council tax revenues.
While the change may help some people in holiday home hotspots get on the housing ladder, in general second-home buyers in these areas don’t often compete with first-time buyers. Those buying their first home tend to buy cheaper properties, often in towns and cities and close to major employment centres.
