Thursday 29 September 2022 11:23 AM Surge in Airbnbs in Wales is forcing renters to move away, spend their savings ... trends now

A huge increase in Airbnbs fueled by the trend for staycations has left renters with an 'impossible choice' to move away, spend their savings or facing homelessness, a think tank reports. 

The Bevan Foundation revealed that holiday lets have surged by 53% from 13,800 in 2018 to 21,718 in May of this year, putting pressure on the housing market. 

The situation is also getting worse as landlords have no incentives to rent homes outside of Airbnb as they earn an average weekly £710.14 for a one-bedroom property and £2,175.71 for a four-bedroom property in Wales. 

This means that landlords make in 10 weeks - or 4.8 weeks on Anglesey, where Airbnb prices are among the highest, - the same income as they would get through local housing allowance rates. 

The returns are even quicker for four-bedroom properties where it takes less than six weeks to get the same income as over a year. 

Local villagers have protested the trend saying people are 'living in caravans or chalets on their parents' land' as it's 'almost impossible' to get a house locally. 

To tackle the issues, from next year, second homeowners in Wales will face a 300 per cent tax hike in a bid to stop locals being priced out of the country's property market. 

But holiday cottage landlords have called the move a 'horribly blunt tool' and 'counter-productive'. 

King Charles III is also getting in on the surge in prices for holiday lets by renting out two of his Llwynywermod estate cottages. 

Dr Steffan Evans of the Bevan Foundation also explained it is a recipe for homelessness as just 60 properties across the whole of Wales in August were offered at 'affordable' rents – meaning those who are on benefits can afford them. 

He said: 'With so few homes to rent for low income households, people are faced with an impossible choice: move out of their community, move into poor quality housing, try to plug the gap between their rent and their benefits by cutting back on food and heating, or become homeless. 

'If we are to find a long-term solution to Wales' housing crisis it is vital that work is undertaken to regulate the holiday let sector as well as the private rental sector.' 

Another key problem is the size of the LHA - the money received by low-income families to cover their rents. 

It continues to dwindle relative to rents, meaning people must plug the gap out of their own pockets - if they can. 'It is clear that this gap is both causing and exacerbating homelessness,' said the Bevan Foundation.

As other holiday rental operators were not included in the study, the true scale of the problem is likely to be worse. 

Anecdotally, landlords are said to be fleeing the private residential rental sector in search of bigger profits in the short-term holiday rental sector.

The latter is also less regulated, a key incentive. 'If landlords switch on a large scale, the pool of available for residential letting shrinks further, increasing the pressure on low-income renters,' said the Bevan Foundation. 

Airbnbs rents are highest in Cardiff but as private rents are higher too, the problem is less acute than somewhere like Anglesey.

In August the Welsh Government launched its Commission for Welsh-speaking Communities to explore problems caused by second homes and short-term holiday lets. 

The Bevan Foundation said this must also focus on the rental crisis as well as the lack of affordable homes for people to buy.

It stressed the rental crisis was not just affecting mainly Welsh-speaking communities such as Gwynedd and Anglesey. 

Morfa Nefyn villager on the Llyn peninsula, Gwynedd, Mared Llywelyn, protested against the issue last year. 

She told the BBC: 'People such as myself, and my friends - it's almost impossible for us to afford a house locally.

'I live with my parents, and I know a lot of people who live in caravans or chalets on their parents' land.

'They are being pushed out of their communities because the gap between local wages and house prices is enormous.'

Gwion Llwyd, who runs Dioni, a booking and management service for holiday cottages in north Wales, said: 'I understand the problem - we have two daughters in their early twenties, and they and their friends are finding it really hard to get on the housing ladder,' he said.

'But I think some of these measures are a horribly blunt tool to try and fix the problem, and could even be counter-productive.'

Communities in Conwy and Powys are also likely to be affected, said the report, adding: 'Any solutions proposed by the Commission should not be limited in their implementation to just those local authorities in Wales that are predominantly Welsh speaking.'

Increasing LHA payments may help in some areas but not all, especially those in Airbnb hotspots, said the Bevan Foundation. Moreover, further controls on the private rental sector, without tackling the holiday rental market, could deepen the crisis.

The report concluded: 'The short-term holiday rental sector does bring several benefits to communities across Wales. 

'For these benefits to maximised, it is vital that action is taken to ensure that a balance is struck between ensuring an adequate supply of accommodation for visitors and for people wishing to live in their communities.'

In response to planned Welsh Government action on holiday lets, via the planning system, Airbnb tentatively welcomed the proposals and said they were an 'opportunity to.... clamp down on speculators that drive housing concerns and overtourism'.

Airbnbs only make a small proportion, 1%, of the total number of rental properties in Wales where holiday lets are concentrated in small areas. 

Gwynedd has the highest proportion of its dwelling stock listed on Airbnb, where 2,885 properties, 4.6% of its total dwelling stock, that could be used as long-term are listed on the site. 

Most Airbnbs also appear to be commercial enterprises rather than individually managed by hosts. 

Just seven agencies manage 26% of all Airbnb listings, making up hundreds of properties across Wales. 

While a total of 56% of Airbnb hosts that have two or more properties listed and 17% comes from from outside Wales. 

Charles's 90 acre royal residence in Myddfai, Carmarthenshire, which could soon go to his son William, the new Prince of Wales, recently put one cottage that sleeps four people up for rent at £2,350 a week and another six-bed up for £2,750, according to ITV. 

The listing reads: 'Sitting within a courtyard range adjoining the Welsh royal residence of Llwynywermod, North Range is a charming barn conversion available for occasional holiday let.

'North Range forms part of a courtyard attached to Llwynywermod Farmhouse and is beautifully furnished to suit the style of the property, with a mixture of period and contemporary furniture including many Welsh pieces and local fabrics.'

Meanwhile, Mark Drakeford's government declared in March short-term holiday lets are increasing the maximum level that local authorities can set council tax premiums on second homes and long-term empty properties by up to four times.

It means that, from April 2023, councils will be able set the premium at any level up to the maximum, depending what is appropriate for their local circumstances. Some may choose to apply different rates for second homes and long-term empty dwellings.

Currently, the maximum premium councils can charge is 100 per cent – so the new policy constitutes a possible tax rise of 200 per cent.

Ministers claimed the change is intended to provide a clearer demonstration that the properties concerned are being let regularly as part of

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