'Crisis' of young and low-paid residents being priced out of tourist hotspots
- Credit: Denise Bradley
Fears of a potential skills shortage have been prompted by rising house prices forcing young and low paid workers out of tourist hotspots.
Analysis by the Office for National Statistics (ONS) found that rising accommodation costs could force some workers out of rural and coastal areas – contributing to skills shortages in tourism and hospitality industries upon which the local economies relied.
While housing prices rose during the pandemic, many young people saw their income fall because of furlough, reduced hours or redundancy – particularly in the hospitality industry.
House prices in East Suffolk rose by 11.49% in the year ending June 2021 while private rental prices paid by tenants in the UK rose by 1.2% in the same 12-month period, against a widespread fall in supply of long-term lettings in the East of England – possibly due to landlords capitalising on domestic tourism through holiday lets.
East Suffolk also ranked in the top 20 areas by rate of second home ownership (3.5%) as of mid-September 2020.
Almost 60% of Southwold’s residential units are occupied as second homes or used as holiday lets.
Last year, it was identified among the most expensive coastal resorts to relocate – with average prices calculated at £487,996 by housing specialist Compare My Move.
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Southwold district and town councillor, David Beavan said the issue was driven by house prices but exacerbated by a number of other factors, including transport and the Covid-19 pandemic.
Earlier this month, the ONS found that hospitality businesses were already more than twice as likely as other industries to be experiencing challenges in filling vacancies.
Mr Beavan said some pubs were being forced to limit food service to fewer nights per week due to lack of staff.
"Those who are working, but rely on public transport, will finish at 11pm and find there's no bus out of Southwold," he added.
"In order to staff the hospitality business, we need people to live here.
"The hospitality industry was really hit hard by the pandemic. Heaven knows they've had a tough enough time without now being unable to find staff.
"It's not only affecting people, but businesses. It's a crisis."
Following planning approval last month, 220 new homes are set to be built on land to the west of Copperwheat Avenue, in nearby Reydon, and sold only to buyers using the property as their principal residence.
Mr Beavan feared that, at 80% of open market value, even the allocation of affordable homes available under shared ownership could be out of reach to many.
Andy Walker, head of policy and public affairs at Suffolk Chamber of Commerce, said: “Whilst some job roles can be delivered remotely, there are many important sectors in the east of the county, such as manufacturing, hospitality and the land-based economy that need staff to be physically present.
“Above and beyond the current general labour shortage facing businesses, Suffolk Chamber is acutely aware of the challenges being faced by workers along the coast due to high-cost and increasingly unavailable rented accommodation and fragmented public transport networks. This is putting further pressure on the growth ambitions of our members and other businesses.
“Local councils have a key role to play via their Local Plans in ensuring that truly affordable housing levels are maintained, if not increased, across Suffolk.
"At the same time, there is scope for local bus companies and other transport bodies to work with major businesses to commission new services such that workers can more easily get to and from their places of work, and Suffolk Chamber has been instrumental in bringing parties together for initial discussions to this end.”
Despite falling from a record high in June, the average UK house price increased by 8% to £256,000 in July, compared with the previous year.
The increase was put partly down to temporary changes to property taxes, including Stamp Duty, but also a shift in consumer preferences, with growth driven by rural and coastal areas due to changes in circumstances and the ability to work remotely.
Peter Ogilvie, who leads the residential sales team at Savills estate agents, in Ipswich, said: “Lifestyle choices made during lockdown have almost entirely dominated decision-making over the past 18 months.
"The pandemic has made people re-evaluate what they want from their homes and their leisure time, with many prioritising a better work-life balance.
"Consequently, the coastal markets and the likes of Woodbridge, Orford, Aldeburgh, Thorpeness, Walberswick and Southwold have been incredibly popular.
"Even with the end of the stamp duty holiday, we have still seen plenty of interest. Demand has continued to outweigh supply and that has inevitably led to upward pressure on prices – with high levels of competition among buyers for those homes which are available.”