Monday, April 5 2004

The number of second homes is set to increase sharply in the next 20 years, according to new work done by the Centre for Economics and Business Research.

In spite of the Government allowing local authorities to decrease council tax discounts on second homes, the Centre predicts that the number of second residences owned by people in the UK will rise from the current figure of 150,000 to 340,000.

The Centre anticipates further growth in ownership of second properties will continue through purchases of holiday homes, but as wealth increases and time pressures grow, they also forsee an increase in second home ownership in urban areas near business districts.

The trend is already noticeable in the City of London, according to the Centre, as well as in Tower Hamlets in the capital.

The report claims that people will be 73% better off over the next 20 years, and as a result of this the Centre expects people to offset their new found wealth against the time they save by living closer to their places of work.

‘For the UK as a whole,’ it says, ‘our calculations indicate that by 2025 the number of second residences will have risen from 150,000 to 240,000, assuming there are no adverse changes to local taxation systems beyond those already announced.

‘This could accelerate the revival of urban areas near business districts, but also lead to further demand pressures in idyllic rural locations, which would drive prices up even further.’