In a move which will surprise many across the UK the Cornwall Council proposition to make all new builds in St Ives only available to those living in the area full-time was backed by 83% of the public in a vote this week. There have been concerns for some time that the second home market in the St Ives is pushing prices way beyond the reach of local people. The situation is somewhat complicated by the fact that St Ives is a blooming tourist destination and the second home market is an integral part of the local employment market.
Is this a sensible move? Will other councils follow suit in due course?
What has been decided?
While the vote could yet be the subject of a judicial review the Cornwall Council is confident that all processes have been followed to the letter of the law and any challenges would prove futile. The idea is that all newbuild properties would only receive planning permission if they were reserved for those living in and around the region of St Ives on a full-time basis. There is no mention of price reductions, financial assistance from the authorities but the introduction of a significant number of new homes in the region would obviously be well received by first-time buyers.
Will this plan work?
There are already concerns that limiting the pool of buyers of newbuild properties to people living in and around the region could force up the price of properties already in existence. Properties already in use in the St Ives region would not be limited to a type of buyer and would therefore still be a part of the second home market. If there was more demand for a potentially smaller percentage of properties in the region could this push prices even higher?
If we take a look at this situation from the point of view of developers would they be as keen to build properties with a smaller pool of potential buyers? At a time when property developers across the UK need to maximise their efforts and maximise their profitability to survive, would this move by the Cornwall Council impact their long-term viability in the area?
Is the second home market a major problem?
Figures released by the St Ives town council suggest that 25% of residential properties in 2011 were classed as “second homes”. This is a 67% increase on the figure in 2011 and is likely to have risen further since that date. The area is something of a magnet for second home and holiday lets in Cornwall, being among the five most popular destinations in the region. So, on the surface it does look as though demand for second homes and holiday lets has pushed property prices to unaffordable levels for local buyers.
Is this plan legal?
There are many questions which the council needs to answer such as would future newbuild properties become part of the second home pool when they are sold on? What are the details with regards to being classed as part of the “full-time local community” and would these indeed pass the array of discrimination laws in place today?
In theory the idea seems sensible from a local property buyer’s point of view but where does it stand with regards to discrimination and how would it impact the local economy?