Measures to tackle the housing crisis in South Hams, including lobbying the government for changes in the law and stopping second home owners from avoiding council tax, have been agreed by councillors.

Other initiatives include the formation of a company as a Community Benefit Society (CBS) to provide property with affordable rents, much like council housing. 

The society would be for the benefit of the community and meet certain charitable objectives such as providing and managing social housing and offering homes for people in financial hardship or for the relief of old, disabled or chronically sick people.  

Property leased to the CBS would be managed through a management service called SeaMoor Lettings.

Councillors also suggested SeaMoor’s increased management portfolio could allow it to become the preferred letting agency for the south west. 

South Ham’s overview and scrutiny committee was responding to issues outlined to the council following the declaration of a housing crisis in the district.  

It was pointed out that the average (median) salary in the South Hams in 2020 was £31,000 but that the average house price was £310,000. 

This would mean a typical mortgage would require a deposit of £17,000, which is beyond the means of the vast majority of local people.

One of the measures proposed to increase availability of housing was to clamp down on loopholes that second home owners benefit from.

Some second homeowners in Salcombe, for example, let them out for more than 140 days and opt to pay business rates, thereby benefitting from small business rates relief. 

If these properties were subject to council tax, it would raise an additional £655,000 in Salcombe alone. 

Across the district, the same change would generate an additional £3.5 million in council tax, from which the council could pump money back into tackling the housing problem.

Councillors stressed that they are not against second homeowners or visitors to the region, but that a fairer approach to funding is needed. 

Visitors provide an estimated £260 million into the South Hams economy each year and is one of the largest employment sectors. The scrutiny committee suggests it is possible to support and enhance this, while ensuring that those whose businesses prosper from it in the accommodation sector contribute to the cost of providing the services they depend on.

Further plans to provide more affordable homes for families would come in an expansion of the scheme to offer incentives for people wanting to downsize.  

There are currently 70 households registered on Devon Home Choice who would like to downsize. The council already has a policy of providing one-off payments of £1,000 plus £500 per bedroom to encourage downsizing.

It is recommended that the payment is increased to to up to £5,000 in areas of high demand. 

Councillors showed their support for a letter sent to Michael Gove, secretary of state for levelling up, housing and communities, asking for his support on several major points, such as stimulating housing delivery after planning permission is granted.

As of 2020, 7,643 homes had planning permission of which 7,116 had not yet begun construction. The council proposes that council tax be levied on homes that have planning consent but have not yet been built after two years, up to the point that planning permission expires. 

The council also asked Mr Gove to help close the business rates loop hole on second homes and charge up to 200 per cent council tax on second homes and holiday homes.

Councillors also want Mr Gove to review something called the Broad Market Area boundaries to acknowledge that the cost of living in rural South Hams is significantly higher than that of its urban neighbours, Torbay and Plymouth, and that rent was the most significant factor. 

The letter asks the secretary of state for a more regular review of the rates and the boundaries to reflect the difference in the rural and urban cost of living.  

Request for the proposals was made by the council’s executive committee in October and was agreed by the scrutiny committee.