The homes are being built in Hunmanby, on the coast, and Shipton by Beningbrough, near York. The council is contributing £875,000 raised through the premium, alongside investment from Broadacres Housing Association and Homes England.
The developments are the first to receive funding from the council’s decision to double council tax bills on second homes, a policy introduced in April 2025 to generate money for affordable housing and other council priorities.
26 homes across two developments
Fifteen affordable homes are being built on land south of Sands Lane in Hunmanby. The properties will have one, two or three bedrooms and will be offered through social rent and shared ownership. Priority will be given to people with a local connection to the area.
The Hunmanby scheme represents a total investment of £4.2 million, including £2.4 million from Broadacres and £1.42 million from Homes England. North Yorkshire Council is contributing £435,000 from the second homes premium.
A further 11 homes are planned for Station Lane in Shipton by Beningbrough. The development will comprise four three-bedroom homes, five two-bedroom homes and two one-bedroom homes. They will be available through social rent or shared ownership for people with a connection to the village and surrounding area.
The Shipton development represents a total investment of £3.3 million, including £1.9 million from Broadacres, £905,000 from Homes England and £440,000 from the council.
Both developments are expected to be completed by autumn 2027. The homes will incorporate energy-efficient features and low-carbon heating.
Using second-home tax revenue for housing
North Yorkshire Council introduced a 100 per cent council tax premium on second homes in April 2025. This means owners pay twice the standard council tax charge, with the policy intended to help address a shortage of affordable housing, particularly in coastal and rural communities.
The council said the premium could generate up to £10 million a year to support affordable housing and other projects. Almost £900,000 raised through the premium has now been allocated to the first two developments.
Simon Myers, North Yorkshire Council’s executive member for housing, said: Providing enough affordable housing is one of the biggest challenges facing North Yorkshire.
When we introduced the second homes premium, we promised that the funding would be reinvested to provide more social and supported housing for local people, with an emphasis on social rent. We are the only council in England to ring-fence this money and reinvest it exclusively in housing-related projects.
These are the first homes to be funded through the scheme, and without the grants from the second homes premium, they would not have been possible. The developments will help local people and families remain in the communities where they want to live.
We are pleased to be working with Broadacres, Homes England and our partners to bring these developments forward.
Affordable homes for local communities
Claire Townson, chief executive of Broadacres Housing Association, said the developments would provide much-needed affordable homes in communities facing housing affordability challenges.
Claire Townson: These developments will provide much-needed affordable homes in the communities that need them most.
We know that many rural villages and coastal communities are facing significant challenges when it comes to housing affordability, with local people and families often finding it difficult to secure a home close to their support networks, employment and schools.
These schemes will help address that need by ensuring homes are prioritised for people with a strong local connection. They also show how funding raised locally can be reinvested to create lasting benefits for future generations across North Yorkshire.
The council said money raised through the second homes premium would also support other housing schemes and regeneration projects across North Yorkshire.