House prices in Gwynedd, North Wales, have experienced a significant decline, attributed to local government measures aimed at regulating the number of holiday homes and second properties in the area. In the final quarter of 2024, property values decreased by 3%, marking a continuation of an annual slump which has seen prices drop by 12.4% year-on-year. This downturn in the housing market has left many homeowners concerned, particularly in a region well-known for its picturesque landscapes and high rates of second home ownership.

The Welsh nationalist-led Gwynedd Council has implemented various policies to address this decline, including the introduction of an Article 4 directive in September 2024. This directive necessitates planning permission for converting residential properties into second homes or holiday lets. Additionally, the council has imposed a substantial council tax premium of 150% on second homes, a move that has been described by some as “anti-English,” leading to criticism from local tourism bosses who warned that such measures could jeopardise regional economies.

Tom Williams, a homeowner from Lancashire, highlighted the challenges faced by second home owners in Gwynedd. Speaking to BBC Wales, he noted that he and his wife have reduced the asking price of their property in Morfa Nefyn by £40,000 after it had failed to attract interest since being listed for sale in April 2024. Williams remarked on a broader concern among sellers, mentioning conversations with families who have owned homes in the area for generations, all expressing worries about the fallout from the current market conditions.

Local homeowners have reported drastic declines in property values, with some noting that their houses have lost as much as £100,000 in value since the announcement of the Article 4 directive. One Gwynedd resident shared their frustration online, stating, “Had a look through my fingers at Rightmove’s tracker. I know it’s not 100% accurate but it’s a good data-based indicator. I am going for a long walk and to try and forget.”

Cyngor Gwynedd has stated that its intention behind these measures is to combat a critical housing shortage affecting local residents. The council’s Housing Action Plan aims to increase the availability of affordable homes for the local population, particularly as research conducted before the Article 4 policy indicated that over 65% of Gwynedd’s residents were priced out of the housing market. The council emphasised the need for improved controls over existing housing stock to better serve the needs of local communities.

While the property market in Gwynedd faces challenges, there are signs of recovery in other regions of North Wales. According to data from Principality Building Society, the average property price in Wales remained stable at approximately £233,194 by the end of 2024, with notable gains in counties such as Conwy and Wrexham. However, Gwynedd’s environment remains uniquely pressured, due to its blend of scenic attractions and high levels of tourism-related property ownership.

In response to the shifting housing landscape, Ashford Price, chairman of the National Show Caves Centre for Wales, echoed concerns about the broader economic impacts of the council’s measures. He warned of potential “serious economic damage” and reiterated that the council tax increases could displace local owners, further complicating the delicate balance between preserving community integrity and fostering economic vitality.

The measures taken by Cyngor Gwynedd continue to be under review as the council monitors the effects of these new regulations, ensuring that the balance between preserving local habitats and addressing the housing crisis remains a key focus for the region.

Source: Noah Wire Services