Cornwall Council has done what many English councils have been threatening for years: it is now charging second homeowners double council tax. From 1 April 2025, properties classified as second homes face a 100% premium on top of their standard council tax bill, meaning owners pay 200% of the normal rate.
"As a council we continue to do all we can to support residents to find the homes they need, from building and buying more homes to working with government to introduce double council tax on second homeowners," said Council leader Cllr Linda Taylor.
For holiday let investors in one of England's most popular tourist regions, the question is straightforward: does the rental income still cover the increased costs?
What Changed in April 2025?
The Levelling Up and Regeneration Act 2023 gave English councils the power to charge a 100% premium on council tax for second homes. Cornwall was among the first to implement it. The premium applies to any property that is not someone's sole or main residence and is not available for commercial letting for at least 70 days per year.
There is a narrow escape route. If a property is available for commercial short-term letting for at least 140 days per year and is actually let for at least 70 of those days, it can be reclassified for business rates instead of council tax. But this means demonstrating genuine commercial activity, not just listing the property on Airbnb and hoping for the best.
A Parliamentary debate on Cornwall's housing crisis on 23 October 2024 highlighted the scale of the problem: in some coastal parishes, more than 40% of homes are second homes or holiday lets, pricing out local workers in tourism and fishing.
What Do Holiday Lets Cost in Cornwall?
Cornwall is not London. Entry prices are far lower, and the market is seasonal, driven by summer tourism rather than year-round business travel.
Estimates based on 3-bedroom houses. Figures are modelled from registry, listing, and market data, not guaranteed outcomes.
Estimated prices vary from roughly £245,000 in former mining towns like Camborne to over £400,000 in tourist magnets like St Ives. The county median for a 3-bedroom house is modelled at about £300,000, less than half of London's.
On the rental side, a typical 3-bedroom Cornwall holiday let commands an estimated £86 per night with an occupancy rate (the estimated percentage of available nights that get booked) of roughly 46%. Long-term monthly rents average around £938, reflecting Cornwall's lower local wages compared to major cities.
That nightly rate deserves context. Cornwall has very limited real Airbnb listing data, so the dashboard's estimates are modelled from local rents and regional tourism patterns rather than observed booking prices. High-season rates in popular towns like St Ives or Padstow can be significantly higher. But as an average across the county and the full calendar year, roughly £86 per night is the modelled estimate.
Do the Numbers Still Work?
Here is a simplified comparison for a £300,000 3-bedroom holiday let in Cornwall, showing the impact of the council tax premium.
Simplified comparison. Actual returns depend on mortgage, maintenance, insurance, and other costs.
Council tax premium is the additional amount above the standard bill, approximated at Band D. Exact figures vary by council tax band and parish precept.
The headline finding: at an average modelled nightly rate of around £86 at 46% occupancy, a Cornwall holiday let grosses roughly £14,400 per year. A long-term tenancy at £938 per month grosses £11,256. The holiday let starts ahead, but once you subtract management fees (18% plus the 3% platform fee) and the council tax premium, the long-term tenancy actually edges ahead on net income. The gap is small, but it challenges the assumption that holiday lets automatically pay more.
The picture looks different in prime locations. A well-managed property in St Ives or Padstow that commands £150+ per night in summer could still comfortably beat the long-term alternative. But across the county as a whole, the automatic assumption that holiday lets pay more is no longer safe.
Seasonality makes this harder still. Cornwall's 46% average occupancy masks the reality that summer months might run at 80-90% while January through March could drop below 20%. Investors relying on consistent monthly income may find the volatility challenging compared to a steady £938 from a long-term tenant.
The Planning Permission Question
Beyond council tax, Cornwall is increasingly using planning controls to manage holiday lets. Properties let for more than 90 nights per year may need planning permission for a change of use, and the government has proposed a new C5 planning use class specifically for short-term holiday lets. Planning Minister Matthew Pennycook was reviewing the proposal as of early 2025.
If implemented, the C5 class would require explicit planning permission to convert a residential property into a holiday let, giving Cornwall's planning department significantly more control over new conversions. For existing holiday lets with established use, the immediate impact is the council tax premium.
Combined with the abolition of the Furnished Holiday Lettings tax regime from April 2025, the stamp duty surcharge rising from 3% to 5% in October 2024, and the incoming national register from April 2026, the direction of travel is clear: the costs of operating a holiday let in Cornwall will keep rising.
Cornwall's Wider Housing Tension
The council tax premium is not happening in isolation. Cornwall has roughly 13,000 second homes and thousands more holiday lets. In popular coastal towns, this has contributed to a housing affordability crisis for local residents.
The median 3-bedroom house in St Ives is estimated at around £407,000, while the median long-term rent across the county is roughly £938 per month. That disconnect, properties priced for visitors and second-home buyers while rents are shaped by local wages, sits at the heart of the tension between tourism income and housing availability.
Investors considering Cornwall should factor in that further restrictions are likely. The double council tax is a first step, not the last. And as the numbers above suggest, the financial case for holiday lets over long-term tenancies is no longer as clear-cut as it once was.
Explore Cornwall rental data on the dashboard
This information is for educational purposes only and should not be considered financial or legal advice. Regulations and market conditions change frequently. Verify current rules with local authorities before making investment decisions.