The UK city that’s driving out second home owners with double council tax

Once a second home haven, this East Midlands city is seeing the number of people selling up rapidly increase before being slapped with a 100% council tax hike.

Leicester saw one in 31 properties used as a second home in 2022, around 4,412 properties. However, that figure is quickly declining following the council’s effort to provide first-time buyers with houses.

New data published last week by the Housing Department found the number of second homes had fallen by a whopping 40% in Leicester to just 2,624.

From 2025, many cities around the country will see second homes hit with the increased charge, as Leicester will be doubling the council tax for its homeowners.

The Local Government Association, which represents councils across England, spoke of the “desperate need for more affordable housing across the country”, insisting that charging more is one method of bringing the houses back to full time use.

Managing director of Knightsbridge estate agents, Luke St Clair, told The Telegraph that many of the second homes are being used by students whose parents own the properties. 

He says: “Leicester University is very popular and is good for law, genetics and medicine, so it might be a case of parents buying houses for their children to live in while they study, that they then hold on to.

“That practice is less common now than it was pre-2016, but we are still seeing cash investors, or owners who are purposely leaving the property empty rather than selling because they don’t want the capital gains burden from it.”

Councils across the country have all been granted the power to issue the same tax hike, with many areas making use of this ahead of next year. This includes doubling council tax on homes left empty after one year instead of two. 

Earlier this year, Purplebricks estate agents said homebuyers had searched for properties in Leicester 52,000 times in the space of three months – this compares to the figure of 38,000 in London. 

Mr St Clair adds that there are more than 10,000 properties for sale in LE postcodes, saying how it has become a popular destination for professionals looking to move within a commutable distance to London and Birmingham. 

“With so many people being called back to offices now, you start to see the benefit of being able to get on the M1 in 10 minutes, which leads to the M69 to Birmingham,” he says.

“You can get to London St Pancras in under an hour, even from Market Harborough, a nice country-ish town with lots of development.”