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With travel restrictions easing, the landlord community is watching to see if the recent boom in holiday lets has been a trend or a change in attitude.
Staycation set to stay?
Global research firm Mintel has given an insight into how lucrative this market is currently. With reports that holidaymakers’ UK spend in 2021 is estimated to be some £7.1 billion, up 22% on 2019.
With this in mind, we wanted to take a look at the factors affecting this market and whether the recent boom in staycations is going to stick.
While some Brits always chose to holiday in the UK, part of the surge in interest has largely been motivated by coronavirus restrictions.
Even now, while restrictions are lifting, there is still confusion around processes and the countries on the “green list”.
With this in mind, some are choosing to plan for local holidays next year.
Whether they are unable to receive the vaccine and are therefore unable to leave the country, or simply unsure of the risks that travel still poses to health, will this affect holiday seasons beyond next year?
Will the holiday let boom we saw in 2021 be sustained, or fizzle out as Covid restrictions and limitations continue to lift?
The motivation for some staycations of 2021 were based on cost.
Whether tied to Covid, and the initial high costs of testing required for flights, or simply cheaper last minute uk-based getaways around lockdowns, some turned to UK holiday lets to save money.
UK residents spent £62.3 billion on visits overseas in 2019, an increase of 7% compared with 2018.
This could indicate that, while able to, UK residents would choose to travel abroad.
Comparatively, UK residents spent £13.8 billion on visits abroad in 2020; 78% less than the year before.
With the pandemic interrupting travel spending from late February onwards, it is clear how the pandemic has affected spending habits.
It will be interesting to see, at the end of 2021, how much this dynamic has swung back to “normal”, or if attitudes towards holidays are changing as a result.
Un-attributable to Covid, there are some in the UK who have changed their attitude towards flights on an environmental basis.
These individuals would rather reduce their carbon footprint than spend a week in Bora-Bora.
It appears unlikely that this opinion would revert once the pandemic has stopped affecting daily lives, and may account for a significant number of staycations in years ahead.
Holiday let sector
Fabrik Invest, which works with holiday parks across the UK, seems to think the effects of the pandemic on the holiday industry are longer lasting than a short term boom.
Managing director Dale Anderson commented:
“The longer-term nature of travel restrictions means a staycation boom not just for this summer but in all likelihood for next year too, and potentially the year after”
“Even once restrictions are lifted, we anticipate many families will still feel reluctant to fly and so will look to take breaks in the UK instead. Add to that those who choose not to fly for environmental reasons and those who can’t or won’t have the Covid-19 vaccine, and so probably won’t be able to fly, and the long-term prospects of the holiday let market here in the UK look very healthy indeed.”
How does this affect landlords?
Whilst some landlords may be waiting for more favourable property prices following the stamp duty holiday, they might be concerned they missed out on a key investment time for holiday let mortgages.
With restrictions easing but still there, it is uncertain as to if next summer will be as favourable to local holiday lets.
On the other hand, travel restrictions will not disappear overnight and longer-term attitude shifts may mean that more choose to stay in the UK in the years to come.