The introduction of council tax premiums on second homes, alongside wider measures designed to curb the growth of holiday lets, has yet to deliver a stronger housing market in areas such as Devon and Cornwall, where sales activity continue to lag behind the South West and England as a whole.
LandSale analysed residential transaction volumes across England, the South West, Devon and Cornwall to assess how housing market performance has evolved following changes to the rules surrounding second homes and holiday lets. The research also examined the distribution of holiday let properties currently listed for sale across England.
Across England, there are an estimated 10,334 properties currently listed for sale that are suitable for use as holiday lets. More than half, 51.2%, are located in the South West.
The South West's dominance is largely driven by Cornwall and Devon, two of the UK's most popular tourist destinations. However, the rapid growth of holiday lets and second homes has become increasingly controversial, with many local communities arguing that they have reduced housing availability, inflated property prices and left towns and villages with large numbers of homes standing empty for significant parts of the year.
In response, the government gave local authorities greater powers to discourage second home ownership, including the ability from April 2025 to charge a council tax premium of up to 100% on second homes. The policy was intended to reduce the financial appeal of holiday lets, encourage more homes back onto the residential market and improve housing availability for local buyers.
While higher running costs appear to have encouraged more holiday let owners to sell, the wider housing market has yet to see a corresponding uplift.
Between 2024 and 2025, residential transaction volumes across England increased by 4.4%. Over the same period, transaction growth reached just 3.7% in Cornwall and 1.5% in Devon, suggesting both markets remain comparatively subdued despite an increase in properties coming to market.
Founder of LandSale, Adam Morris, commented: "Measures designed to discourage second home ownership were introduced with the aim of improving housing availability and creating healthier, more balanced local property markets in popular tourist destinations such as Devon and Cornwall.
"There's evidence that higher council tax charges have encouraged more holiday let owners to bring properties to market, but increasing supply is only one part of the equation. A healthy housing market also relies on strong buyer demand and consistent transaction levels.
"More than a year on from the introduction of these changes, the data suggests the policy has yet to translate into stronger market performance. Instead, both Devon and Cornwall continue to trail the wider market when it comes to sales activity.
"That doesn't necessarily mean the policy has failed, because encouraging more homes back into residential use was always a long-term objective. However, it does suggest that increasing supply alone isn't enough to transform local housing markets, particularly where affordability, borrowing costs and buyer confidence continue to influence purchasing decisions."
