"Staycations often offer a more affordable alternative for holidaymakers across the UK and, combined with the fact that our country has such incredible places to discover, it appears demand for UK holiday lets is going nowhere"
A new ranking of the best places in the UK to invest in a holiday let has revealed that with house prices averaging £256,500, and an average revenue potential of over £46,000 per year, Cheshire is leading the way.
The data, from a new report by Sykes Holiday Cottages, found that Anglesey and the Lake District follow closely behind, while other common UK holiday hotspots like the Peak District and Norfolk also featured in the top ten.
The Holiday Letting Outlook Report 2023 analyses Sykes’ revenue data and occupancy figures, alongside house prices, house price growth and investment returns, as well as containing consumer research and insights from Oxford Economics to paint a picture of the positive impact holiday letting has on UK economies amid growing scrutiny of the sector.
According to a poll of UK holiday homeowners commissioned for the report, 25% are very worried about the potential of new regulations or fees being enforced following the government’s recent Call to Evidence.
However, sentiment amongst holiday let owners remain strong and the demand for staycations still appears to be growing, with bookings for Sykes’ holiday lets in 2023 up 9% compared to last year already. Consumer research found that 50% of holiday let owners say bookings are still stronger than ever post-pandemic, with 63% planning to grow their holiday let portfolio over the next five years.
Compared to the same period prior to the pandemic, new owner enquiries from prospective holiday home investors increase by 173% in 2022.
Being a record year for staycations, the report found that the average holiday let owner earned £24,000 in revenue from their holiday let last year, up 59% from 2019. In terms of where to invest in the short-term, Cumbria and the Lake District topped the highest-earning holiday hotspots list according to Sykes’ revenue figures, with holiday lets earning an average revenue of £28,000.
The Cotswolds made its first appearance in the top five highest earning regions list, with an average annual income of £28,000, closely followed by the Peak District in third place and an average turnover of £27,500.
Research found that the average holiday let owner spends around £7,400 per year on expenses for their holiday let, with the highest costs being utility bills and property maintenance.
Graham Donoghue, CEO, Sykes Holiday Cottages, said: “Our analysis shows demand for holiday lets held strong over the past year - demonstrating the resilience of the market in what are undeniably challenging times.
“Staycations often offer a more affordable alternative for holidaymakers across the UK and, combined with the fact that our country has such incredible places to discover, it appears demand for UK holiday lets is going nowhere.
“Our new investment analysis has identified the locations to watch when it comes to investing, and I would encourage anyone considering making the leap into holiday letting to get in touch to find out how else they can make the most of their investment.
“As many are clearly aware, the UK Government is currently looking into concerns from some quarters about the impact of holiday letting on the housing market, but at this stage, our view is that any immediate changes for the sector are quite unlikely amid other priorities in government.
“Clearly, it’s vital that the market operates responsibly and doesn’t negatively impact communities. But it is also important that the positive impact of the sector is not ignored, with any changes to how it operates risking having unintended consequences on local economies and job opportunities.”
