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Second home renters
The number of people renting second homes has reached a record high.
Whether it’s a bolt-hole in town or a place to unwind in the country, the appeal of a second home is an enduring one. However, in April 2016, the introduction of increased stamp duty on second home purchases meant that for many, hopes of future ownership were dashed.
However, for those who remain distracted by thoughts of a home by the sea or a pied-à-terre in the town, there may still be a way. Ownership is not necessarily a barrier to realising a second home dream as would-be buyers are now increasingly choosing to rent instead. In fact, last year (2017) a record 13,680 properties were rented as second homes, up 11% on 2016 and a huge 136% increase on 2007.
Six of the ten second home rental hotspots were located in the South East or the South West. Windsor and Maidenhead, close to good schools places of work, proximity to London and Heathrow topped the list with 14% of properties let there
were rented as second homes. While the more rural areas of Gloucester and Tewkesbury in the South West followed with 11% and 6% respectively.
What about the capital? London, had the third highest proportion of rented homes let as second homes. Many of these are used as a pied-à-terre during the week and an alternative to the small apartment which could have quite possibly been purchased before the stamp duty change.
Second home renters are more likely to pay more than the average tenant renting a primary home. Last year an average rent on a second home cost £1,060 a month, some 24% more than the average home for rent. And in London, the figure was almost double at £2,030 a month.
Properties with fast transport links into the capital command some of the best rental incomes. Places such as St Albans in Hertfordshire, close to the countryside but just 20 minutes into London by train.
While second home rentals may be on the up, sales of second homes have undoubtedly suffered. Only 3,850 second homes were bought in the first quarter of this year, which compares to 6,400 in Q1 2016, prior to the introduction of the additional stamp duty surcharge. The average cost of a second home in Great Britain is £312,450, but this rises to £1.8 million in prime areas, and surprisingly, over two thirds of second homes located in prime areas are cash sales. But second home sales hotspots differ for rentals, with Scarborough, Pendle and Torbay topping the list.
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