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All across England, Scotland and Wales, the UK holiday letting market is thriving and a growing number of property owners are taking advantage of the high rental yields, a booming domestic tourism industry, and favourable tax conditions for holiday lets.
This upsurge in the staycation market is reflected in the number of new property owners who have joined us over the last 12 months and for whom 2022 is shaping up to be a bumper year with advanced bookings already at record levels.
So, no matter what stage of the letting journey you're on, download a free letting guide, or read on to discover the five reasons why a holiday home is a good investment.
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A fantastic income opportunity
Having the right holiday home in a great location certainly helps with bookings but there are plenty of things property owners can do to enhance their return further, no matter where they are located by including features that make the property really stand out, attract more bookings and ultimately deliver more income.
Hot tubs have a great, positive impact and can help to achieve up to a 15% increase in weekly rental and attract an extra 40 days booked per year - this is why we contribute £500 towards the cost of a hot tub for our existing owners. Other factors that can have a positive impact include becoming a dog-friendly property, installing a wood burner and offering en-suite bathrooms throughout.
It’s important to recognise that property owners do need to factor in the running costs, which are typically borne by the tenant in a long let. However, even after deducting these costs, it is not unusual for the weekly rental income to outstrip the monthly return you would expect to achieve with a traditional long let. Find out ways to create a great holiday let that people will return to year on year in our handy guide to top holiday features.
What our existing owners think
“We have been incredibly impressed by the holidaycottages.co.uk team. From start to finish, we have had the assistance we needed. The quantity of bookings we have received has been very impressive.” Pound Barn | Gloucestershire
A strong outlook for UK tourism
With economic uncertainty and the impact of inflation and interest rates, the cost of living for many households is affecting disposable income.
And yet, despite concern over the outlook for household finances, according to research by Mintel, in 2023 the number of domestic holiday property stays taken by British residents is expected to have increased by 1.1% compared to 2022, reaching 8.3 million holidays. Associated spending is also estimated to grow by 3.2% to £3.3billion over the same timeframe.
Looking further ahead, the volume of domestic holiday property stays taken by British residents is expected to grow to 9.1 million in 2028 and associated spending is expected to increase to £3.6 billion that year.
What our existing owners think
“I have found holidayacottages.co.uk good to work with, always very professional, they take the stress away, give reassurance during the challenging times of the build and provide a no-hassle holiday letting service.” Capel Neigwl | Abersoch, North Wales
Favourable tax benefits
If you meet the criteria to be a Furnished Holiday Let (FHL), the tax office allows additional tax benefits, some of which are over and above those afforded to long-term residential landlords.
To qualify as a Furnished Holiday Let (FHL), the property must be available to let for at least 30 weeks a year and actually be let for 15 weeks a year. Also, the property cannot be let to the same person for more than 31 consecutive days. Visit our blog to learn about more tax considerations.
What our existing owners think
“We have found holidaycottages.co.uk to be more proactive in their approach to the holiday market and this has shown in our bookings.” Buckland Barn | Buckland Brewer, Devon
Holiday let mortgage availability
Holiday let mortgages are still quite a niche product, but as this sector becomes more attractive to investors, the number of lenders in the market is growing and the choice of products is becoming more competitive.
What's more, whilst most costs associated with raising finance are allowable, if the purchase is structured correctly, there may be ways to obtain tax relief on interest payments that were previously treated as non-allowable domestic mortgages on your private house. For more related information, read our guide to holiday let mortgage criteria.
What our existing owners think
“holidaycottages.co.uk have provided us with a friendly contact who manages our area and there is always someone with the right expertise to help should we need it and that makes us feel part of a family.” Skell Gardens Cottage | Yorkshire
Enjoy your own holidays
In Britain, we have a tradition of home ownership, getting onto the property ladder and investing in bricks and mortar. Holiday homes have all the same appeal and more!
You can use the property yourself and treat the investment as a means of subsidising your own family holidays. It is also a really rewarding experience welcoming people to your holiday home. If you’ve invested time, money and effort creating what you believe is a great place to stay, it is a real compliment when your guests express the same sentiment in their feedback. You can be sure they will be telling all their friends about it as well.
What our existing owners think
"We have now been with holidaycottages.co.uk for several years and have increased bookings with them as the years have passed. Always efficient and helpful, with support from your own property manager which at times is vital.” The Mews House | Norfolk
Interested in letting your property?
We're here to help your property achieve its full potential. To arrange an appointment with your local holiday letting advisor, or to request a guide for builder, buyers and converters, phone 01237 459990 or email [email protected]. Alternatively, download a letting guide here.
Get your free letting guide
*Figures for 2020 staycation boom taken from BBC (as of January 2021) / **Figures for 2019 taken from Statista (as of April 2021)
The content of our article is provided for general information only. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this article.