Holiday let landlords using platforms like Airbnb are considering selling up thanks to rules coming into force.
Local authorities will be able to double council tax bills on second homes let out for at least 70 days per year, in plans unveiled by former Housing Secretary Michael Gove. Meanwhile mayors will be able to restrict new second homes in tourism hotspots, while owners could face spot checks
One landlord, who has been in the holiday let business for 25 years, has already sold a holiday let in Whitstable, Kent, and has two remaining in Essex and on the Isle of Wight, alongside one buy-to-let property.
She told The Telegraph: “I am very worried about the proposed restrictions. It took me so long to build the business but I am considering closing it if more rules come in.
“We used to be encouraged by the government to be entrepreneurial, but now we are being castigated.”
She added: “I’m currently sitting on the funds from the one sale and really holding off putting it back into rental. Who wants to have money in a property you can’t control?
“I’m now looking at putting the funds in a savings account or buying an annuity. It’s a far better return for much less hassle. Running a holiday let is a 24/7 job.”
Her short-term let portfolio has been used by tourists, as well as families in need of interim accommodation and by contractors.
Another landlord had 25 properties, but has already scaled back to five lets.
He said: “More regulatory hurdles and the fees that come with them will cause the cost of doing business to rise significantly and with it the price of insurance and debt.
“If the government is seriously worried about a housing shortage it needs to go back to basics; driving out investors isn’t the answer. I am certainly considering selling up altogether.”
The staycation sector boomed during the pandemic, which forced people to holiday domestically.
Now things are returning to normal however, encouraging some fair-weather landlords to invest elsewhere.
The nightly rate for holiday lets has dropped by 4.9% in August compared to the same period last year, analysis from data firm AirDNA has found.
The government changes were motivated by some areas being turned into tourist ghost towns, effectively losing their identities.
One such area is St Minver Lowlands in North Cornwall, where around 70% of all properties in the area comprise of holiday lets or second homes.