A recent survey has confirmed that those who own second homes in Scotland are wealthier and have higher incomes from those who only own one home.

The data compiled from the Wealth and Assets Survey 2018-2020 includes those with second homes which they use as short term lets.

They are wealthier in terms of total wealth and also in terms of each of the components of total wealth, property, pension, financial and physical wealth.

The main value in wealth comes from their main residence (65%) with additional homes making up on average 30%.

After property, second home owners in Scotland, also have wealth from pensions and considerable financial wealth.

The latest figures, for September 2021, show that there were 23,890 second homes in Scotland. The number of second homes is 2% (576 homes) lower in 2021 than in 2020 and after remaining at broadly similar levels in 2019 and 2020. For the same period there were 45,801 unoccupied exemptions which have generally been empty and unfurnished for less than 6 months, and 43,766 long term empty properties that had been empty for more than 6 months. 

For 2021-22, 25 out of the 32 local authorities have removed the council tax discount on second homes, 6 (includes Orkney Islands Council) retain the 10% discount and in one local authority from 1 October 2019 a second home discount of 10% will only apply for a period of 12 months from the date the property was last occupied as a sole or main residence, following the 12 month period the discount will be removed.

For Council Tax purposes a second home is a property that is “no ones’ sole or main residence but is furnished and evidence is produced to establish that it is lived in for at least 25 days during any 12 month period”. You can apply for a Council Tax discount of 10% which, from 1 October 2019, will last for up to 12 months from the date the property was last occupied as someone’s sole or main residence. The discount will not apply to any water or waste water charges.

If the property is not lived in for at least 25 days in any 12 month period, the property will instead be treated as an empty property and subject to the empty property surcharge of 100%.

There are a small number of empty properties and second homes that are entitled to receive a discount of 50%. From 1 April 2019, this may include a second home where a person’s sole or main residence in Orkney is separated from their place of work by a body of water, the transport provision over which does not permit daily commuting between their sole or main residence and their place of work, and they occupy a second home in Orkney to enable them to maintain that employment.

Orkney Islands Council

Covid and lockdown affected these additional properties with many being left unoccupied during the period of travel restrictions.  The total number of long term empty properties and second homes decreased by 6% to 67,656 in 2021 compared to the 71,799 homes in 2020.

Orkney like many parts of Scotland has a housing crisis. In areas popular with visitors, islanders and those moving into the islands with employment unable to find affordable homes due to the number of second homes and buy to lets skewing the housing market.

Building Affordable Homes

In Scotland the total number of affordable homes completed in the 12 months to end March 2022 was 9,757, an increase of 51% (3,279 homes) on the 6,478 homes completed in the previous year, and the highest financial year figure recorded since the start of the series in 2000-01. 

Housing Secretary in the Scottish Government Shona Robison said:

“The pandemic showed the value of a good quality home, but it also threw up significant challenges for all those involved in delivering affordable housing over the past two years. I am very pleased that despite that we have reached our 50,000 target and that since 2007 we have delivered 111,750 affordable homes, with over 78,000 of these for social rent.

The Scottish Government aims to deliver 110,000 affordable homes by 2032, of which at least 70% will be for social rent and 10% will be in rural and island communities.

Fiona Grahame