Buying a holiday let is a fantastic way to diversify your property portfolio and take advantage of the growing market of UK holiday lets. With the rise of businesses like AirBnB and Vrbo, there is plenty of appetite for UK holiday lets, making now the best time to explore holiday home investment.
When we think of holidays, many of us dream of hopping on a plane to a sunny destination abroad. At least that was the sentiment pre-2019. Since then, Coronavirus travel restrictions and the cost of living crisis have encouraged many Brits to search closer to home for their next holiday. This recognition that the UK can provide gorgeous holiday destinations without the airport stress, currency confusion and need for a passport has led to a change in priorities for British holiday goers. Demand for ‘staycations’ has increased by 73%, showing how our perception of holiday homes and holiday lets has changed.
As demand for national holidays increases, so does demand for short-term holiday lets. Unlike many sunny European destinations, Britain does not offer comprehensive resorts to provide a ‘home away from home’ experience. Similarly, many hotels seem to lack the personal touch that many of us search for when looking for a holiday let. Nowadays, we want more than just a generic room. This is one of the most pertinent reasons for the rise of businesses such as AirBnB and Vrbo. Unlike traditional hotels, these landlord-run short-term lets offer holiday goers a chance to properly integrate themselves into local cultures, with many of these properties being set in regular residential streets and city centres close to locals. What’s more, AirBnB and Vrbo offer a broad variety of lets for generally cheaper prices, each of which has its own character. With these holiday lets, there’s no such thing as a ‘one size fits all’ hotel room devoid of charisma. Thanks to these platforms, you can rent out treehouses, windmills and converted churches in just a few clicks. With such unique, beautiful options on your doorstep, why would you ever want to travel abroad?
Holiday homes are fantastic investment opportunities that can provide impressive rental yields and optimal flexibility. Studies show that despite the cost of living crisis, Brits are still planning plenty of staycations for the future. In fact, LEK unveiled that 70% of Brits planned to prioritise holidays over other forms of expenditure. Additionally, 59% of Brits aim to travel more in 2023 than in 2022. The nation’s appetite for holidays is still going strong. With relaxed post-pandemic restrictions, we can expect to see more travellers visiting UK tourist hotspots in the future.
Holiday lets also provide investors with increased flexibility, especially when compared to buy-to-let options. Want to stay at your holiday home over the summer, or rent out your unit to a friend? Holiday lets offer you the flexibility to pick and choose when you wish to host or use the property for yourself. You could even use your holiday home as one of your main residences and rent it out when you are travelling for work or visiting family. This flexibility is not an option with buy-to-let where landlords must let to tenants for longer periods of time. Speaking of flexibility, short-term lets offer landlords the opportunity to amend their pricing based on seasonal peaks and troughs. They can charge a premium for in-demand periods, and can change their fees to stay competitive with other nearby properties. It is this flexibility that makes holiday properties a particularly attractive property investment model.
Stuck between long term buy-to-let or holiday home investment? Both options have their benefits, but holiday home investment presents far more opportunity for high yields – provided your property accumulates enough interest. The average occupancy level of a holiday let in the UK is between 20 and 24 weeks per year, although this can surge to around 40 weeks per year in particularly desirable locations. What’s more, buy-to-let landlords will usually be able to access yields of 6% – however, holiday lets can provide yields that are up to 30% bigger than their buy-to-let counterparts. With holiday rental prices on the rise, the potential for even greater yields is increasing. Remember that the success of your holiday let and ability to obtain a better return on investment hinges on finding a property that people actually want to rent. This is why it is important to choose a unit in a prime location to attract holiday goers.
According to the 2023 Travelodge Travel Index, the top five coastal holiday destinations are Cornwall, Devon, Isle Of Wight, Whitby and Blackpool. The five most popular rural destinations are the Lake District, North Wales, Scottish Highlands, The Cotswolds and Northumberland. All of these locations have two things in common – quintessentially beautiful British scenery, and ample leisure opportunities. These two factors attract travellers from far and wide and provide holiday goers with time to relax. In fact, research shows that approximately two thirds of holiday goers prioritise relaxation over adventure.
So, when buying a property as a holiday let, put yourself in the shoes of your customers. Can I relax here? Is there much to do for families? And can I get here easily?
Ready to start your holiday home investment journey? Start your search with Centrick’s upcoming premium holiday let opportunity at North Quay!
Set within the picturesque town of Hayle in the ever-popular Cornwall, North Quay presents a rare opportunity to invest in one of the UK’s most sought after ‘staycation’ destinations. With on-site cinemas, restaurants and hotels, a variety of apartments to choose from, and enviable harbour views – the 500-unit development ticks every box.
Properties at this new harbour destination are already experiencing huge demand. To find out more about this holiday home investment hotspot, contact Centrick by filling out the form below!
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