Norfolk Properties Encouraged To Turn Second Homes Into Holiday Lets

Of the 330,000 holiday homes in the UK, 14% of these are based in Norfolk – and this is encouraging many to turn these homes into holiday lets rather than leave them sitting for most of the year and ramp up the tax.

For some owners, turning a property into a holiday let can provide an income while still allowing them to use the property themselves at certain times of the year.

Why are second-home owners facing higher costs?

One of the biggest changes has come from council tax. Since 2025, local authorities in England have had the power to charge a council tax premium of up to 100% on second homes. Some councils have chosen to introduce this additional charge, meaning owners can face significantly higher annual bills.

In Wales, councils can also apply substantial premiums to second homes, with some areas charging more than double the standard council tax.

These changes are intended to encourage more second-home owners to make properties available as homes for local people. However, they have also made some owners reconsider whether keeping a property as a second home makes financial sense.

Holiday lets offer another option

For owners who do not want to sell, turning a second home into a holiday let can appear to be an attractive alternative.

A property that is regularly rented to holidaymakers can generate an income rather than simply sitting empty for much of the year. Read more about short term lets management here.

There are also different rules around business rates. In England, a property may qualify as a self-catering holiday let for business rates if it is available to let for at least 140 days a year and is actually let for at least 70 days.

Properties with a low enough rateable value may also qualify for small business rate relief, potentially reducing or eliminating the business rates bill.

This difference in treatment has encouraged some second-home owners to consider whether holiday letting could make more financial sense than continuing to use the property solely for personal purposes.

The number of second homes is changing

The shift towards holiday letting comes as the number of registered second homes has started to fall.

According to figures reported by The Times, the number of second homes dropped from 279,870 in 2024 to 268,152 in 2025. At the same time, the number of holiday lets increased slightly to 67,858.

More than 200 councils now apply a 100% council tax premium to second homes, with further councils joining the scheme in 2026.

These figures suggest that tax changes are influencing how some owners use their properties, although there are other factors affecting the market too.

Holiday-let tax advantages have also changed

It is important to remember that holiday lets are not as tax-efficient as they once were.

The special Furnished Holiday Lettings tax regime was abolished from April 2025. This means qualifying furnished holiday lets are now generally taxed under the same property income rules as other residential rental properties.

Owners have therefore lost some of the tax advantages that previously made holiday lets particularly attractive.

For example, the old rules provided more favourable treatment for mortgage interest, capital allowances and certain capital gains tax reliefs. These benefits are no longer available under the former FHL regime.

This means anyone considering converting a second home into a holiday let needs to look carefully at the figures rather than assuming it will automatically reduce their tax bill.

How does this second homes tax impact local housing in Norfolk?

The move towards holiday letting is not without controversy.

Local communities in popular tourist areas have raised concerns that a growing number of properties being used as holiday accommodation can reduce the supply of homes available to local residents.

Campaigners argue that converting homes into short-term lets can make it harder for local people to find affordable housing and can change the character of communities.

This is one reason why governments and councils are looking at additional controls on second homes and short-term holiday accommodation.

What should second-home owners do?

Second-home owners who are concerned about rising costs have several options.

They could continue using the property as a second home, sell it, rent it out on a long-term basis or explore the possibility of running it as a holiday let.

The right choice will depend on the property, location, finances and the owner’s personal circumstances.

The key point is that tax changes are making second-home ownership more expensive, and this is encouraging some owners to reconsider how their properties are used.

For those thinking about holiday letting, professional tax and property advice can help establish whether the numbers actually work before making the change.