What affect would taxing second homes have on the economy

[NotAGolf]

What would happen if the UK government were to announce that they're going to introduce a huge tax on second homes (holiday homes, BTL or other). A tax so big that having a second home becomes completely unviable. Let's say this were to come into force immediately, but on a sliding scale so the final tax value doesn't kick in for 5 years.

The government would also force lenders to offer mortgages of up to 100% LTV, meaning that anyone who currently rents should be able to get a mortgage instead.

Mortgage repayments are a fair bit less rent, and the flood of second homes coming onto the market would likely reduce house prices (possible crash?), meaning that most people would have lower mortgage repayments and thus more disposable income no?

As you may have noticed by now, economics and the housing market aren't my strong points - I'm just thinking out loud. I'm sure there are plenty of people who would lose out if this were to occur (e.g those with 2nd homes, people that want to rent, people that will end up in negative equity if the housing market crashes etc), but I imagine these would be in a minority.

Thoughts?

 

[NotAGolf]

Wow, quite the response!

I was not suggesting the moves in my OP were wise and/or feasible. Merely asking the question to learn a bit more about the cause and effect that such actions might take. I admitted in my op that I'm pretty clueless in this area (and still am tbh).

One thing that still doesn't make sense to me is why (as a couple of people have suggested) would a house price crash cause lots of people to default on their mortgage? If other things come into play like intereste rate rises or mass redunandacies then sure, but if it was just a 20% drop in house prices, why would that cause people to default? I understand that a 20% drop would put a lot of people in negative equity and thus be unable to move, but their mortgage payments would still be the same. I guess once their current mortgage deal ends they could be moved onto a higher interest rate that they're unable to get out of due to the negative equity?