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National HMO Lobby



Second Homes for Students
Discussion Document

1 The National HMO Lobby welcomes the Report by the National Housing & Planning Advice Unit, Rapid Evidence Assessment of the Research Literature on the Purchase and Use of Second Homes, published by NHPAU on 10 October 2008. The Report was prepared by the Centre for Comparative Housing Research at De Montfort University in Leicester, and is intended to inform plans for housing supply, which is of particular concern to the Lobby. The Report surveys the definitions of 'second home', the buyers, the properties and their distribution, and their impacts; it simply summarises the current state of knowledge, and makes no recommendations, except to identify where further research is needed. The Lobby has no wish to add to the 'innuendo' surrounding debate on the impact of second homes (para 248), but it wishes to raise some points regarding the cause, course and consequence of second-home provision - or demand, supply and impact.

2 The Report surveys definitions of second homes in Chapter 2, and touches on demand in Chapter 4. The former shows that many researchers simply equate second homes and holiday homes ("what constitutes second homes or holiday homes has been a perennial problem" Wallace et al, quoted in para 16). Data sources on the other hand adopt a much more open approach (paras 33-4 "Second residences were defined as company flats, holiday houses, weekend cottages, and so on, in permanent buildings which were known to be residences of people who had a more permanent address elsewhere" Census, 1991 and 2001; para 38 "Second homes are properties, owned or rented by a household member, which are not the household's main residence" Survey of English Housing, 2007; para 44 "In essence the Council Tax definition amounts to defining second homes as 'furnished homes that are no-one's main residence' " [Gallent at al, 2005, p6]). More interestingly, the research by Direct Line (para 101) identifies a wide range of reasons why people buy second homes - for holidays, for work, for study, for investment (this also noted involuntary reasons, such as inheritance or marital breakdown). This study has the virtue of opening up analysis of types of second homes. It also muddies the water by introducing investment properties (like buy-to-let). However, as the Report shows in para 49, ONS usefully distinguishes between 'house' and 'home' - when the former is let, it may become someone else's first home. This leaves three main reasons for buying second homes - for holidays (51%, by far the most common), but also for work (like 'crash-pads', 19%) and also for study (5%). This last is very familiar to members of the National HMO Lobby in the form of houses bought by parents for their children when they attend university. Their children 'go away' to these homes in term-time, and they 'go home' in vacations. Though they may stay there for eight months of the year, in case of need, they have a first home to retreat to. The National HMO Lobby therefore recommends that future study of second homes should include second homes used for the purpose of study, or student houses.

3 The Report also touches on the provision or supply of second homes in Chapter 2. In para 17, three tiers (or three circles) of holiday homes are identified, (a) second homes, (b) investments, and (c) company-owned property. These categories identify the properties from the buyer's perspective. Seen from the user's perspective, these become (a) second homes again, (b) holiday home lets, and (c) purpose-built holiday accommodation. The same circles are apparent in properties used for study - (a) houses bought by students' parents, (b) houses let by student landlords (many of which may be buy-to-let investment properties), and (c) purpose-built student accommodation (halls of residence, blocks of cluster flats, etc - which may double as holiday lets). There are similar circles of properties used as a work base (commuter-owned, week-day lets, purpose-built crashpads). The first circle in each case clearly comprises second homes. The last circle clearly does not: they have not been built (or converted) as first homes, nor are they usable as such. The middle circle remains a grey intermediate area. The properties concerned have been built as first-homes; they have been bought as investments; and they are now let as second-homes, for holidays or work or study. In terms of usage (seasonal) and in terms of impact (see 4 below), properties in the middle circle are indistinguishable from those in the first. In terms of their significance for housing supply therefore, the National HMO Lobby recommends that future study of second homes should include homes which are rented as such, as well as those which are bought.

4 The Report considers the impacts of second homes in Chapter 9, and these are analysed in terms of social, economic and environmental impacts. The National HMO Lobby suggests that there are in fact two levels of impact of second homes.
(a) If there was a surplus of housing in the UK, then second homes would not arise as an issue, and the Report would not have been commissioned. In fact, of course, there is a shortage. Therefore in principle, the principal impact of second homes is the loss of first homes. In a limited situation overall, any increase in second homes can only be at the expense of a decrease in first homes. (This inevitably impacts on the housing market, as considered by the Report in paras 189-195. And it underlies George Monbiot's view: "There is no greater inequality in this country than that some people should have two homes while others have none" quoted in para 178.)
(b) Otherwise, isolated second homes would not have significant social, economic or environmental impact. However, as the Report points out in Chapter 5, the tendency is for second homes to concentrate in very particular locations - holiday homes, for instance, in desirable rural or coastal sites, or crashpads in town centres, or student houses 'in the shadow of the ivory tower' (paras 123-125). The members of the National HMO Lobby have wide and deep experience of the last.
At both of these levels, the impacts are the same, regardless of whether the second homes are owned or rented by their users. The National HMO Lobby endorses the report's call for closer examination of the impact of second homes on local communities (paras 240-247), and notes that literature already exists on the impacts of student second homes (studentification), including Universities UK, Studentification: a guide to opportunities, challenges and practice (January 2006), National HMO Lobby, Balanced Communities & Studentification (March 2008), and CLG, Evidence Gathering: Housing in Multiple Occupation and possible planning responses (September 2008).

5 The National HMO Lobby is well aware of the housing problems currently confronting the country, and it has responded to last year's Housing Green Paper. The Lobby welcomes NHPAU's Report as a valuable contribution to addressing these problems. In particular, the Lobby's concern is with optimum use of the existing housing stock (alongside the government's prioritisation of new-build). The issue of second homes of course is central to the use of existing stock. The National HMO Lobby therefore urges those developing housing policy at local, regional and national level to consider the impacts of second homes, and in order to do so effectively, to consider all properties used as second hones, whether owned or rented, and whether used for holidays or work - or for study.

National HMO Lobby, November 2008


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