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Category: holiday lets

The UK holiday let market has remained strong, with bookings, revenue, and short-term expectations on the rise, despite the cost of living crisis and a possible review into the sector, according to a report by Sykes Holiday Cottages.

CEO of Sykes Holiday Cottages, Graham Donoghue, discusses trends of the past few years in the holiday let market:

“In recent years, UK has enjoyed a staycation boom, with travel restrictions causing many to opt for a holiday at home over going abroad.

“This latest report reflects how holiday let owners are feeling amid growing cost of living pressures and rumours of regulatory changes.

“Despite the lifting of all travel restrictions that were put in place during the pandemic, the holiday-let market remains highly active with increasing numbers choosing to holiday in the UK.”

Sykes Holiday Cottages have analysed their booking data and income data to further investigate how the market performed last year and what are their expectations for 2023 and beyond.

The report findings

The top reasons for owning a holiday let include:

  • To use for personal use as well (52%)
  • To supplement existing income (43%)
  • An investment for future finances (38%)

The holiday cottage rental agency states that the average owner reported a turnover of £24,000 in 2022, an increase of 59% from 2019.

Bookings for UK holiday lets increased by 48% in 2022 compared to 2019, and bookings made in the year to date were approximately 9% higher compared to the same period in 2022.

The revenue rose to £33,000 for a three-bedroom property and £57,500 for a property with five or more bedrooms.

The report found a surge in enquiries from new owners in 2022, almost triple the amount compared to 2019, with 63% of the enquiries related to new holiday lets.

Over 50% of holiday let property owners have started to let over the last three years, and around 63% of them are planning to expand their holiday let portfolio over the next five years. Whilst around 84% of owners state that bookings are stronger than ever and are expecting this trend to continue over the next five years.

According to the report, the cost of living crisis has made a significant impact, as 28% of holiday home owners are seeing more bookings for shorter breaks.

To cut costs, 20% of owners plan to take on additional jobs (i.e. cleaning and maintenance), while 16% plan to let their properties out for more weeks in 2023.

The report also found that the average cost of running a holiday let were around £7,400 per year, but this was dependent on the property size, amenities, and level of involvement.

According Sykes Holiday Cottages, additional ways to make your holiday let more cost effective include reminding guests to save energy, installing smart meters, and draught proofing your property to ensure it is well insulated and is not losing heat.

Post-pandemic trends

Report findings reveal that half of home owners witnessed an increased demand for UK holidays, whilst 27% state that holidaymakers are now more likely to rebook properties.

Just over 20% have noticed more group bookings and 17% state that they have identified a trend in younger group bookings.

Most profitable regions

The Cumbria and Lake District regions were the most profitable holiday let regions, along with the Cotswolds, the Peak District, Cornwall, and Dorset, all around earning around £26,000 to £28,000 per year.

The company identified the following regions as the best investment opportunities in the long-term, based on average house prices, house price growth, and the average revenue of a four-bed holiday let:

  • Anglesey
  • Angus
  • Cheshire
  • Dumfries and Galloway
  • Lake District
  • Lincolnshire
  • Norfolk
  • North Yorkshire
  • Peak District
  • Pembrokeshire

Final remarks

CEO of Sykes Holiday Cottages rounded up the report by stating:

“We’re still seeing a significant number of new holiday home owners join us despite the rising cost of living, and positively for owners, bookings and income levels are continuing to grow.

“The government’s impending review into the sector can’t be ignored and our research would suggest that this is on holiday let owners’ radars too. However, at this stage, our view is that any immediate changes for the sector are quite unlikely amid other priorities in government. “

He continued:

“In the meantime, our focus as a business is on continuing to demonstrate the sector’s positive impact while playing our part in supporting its sustainable growth.”

Get a deal today

If you are a landlord with a keen interest in investing in a holiday let property, we recommend seeking the advice of our team of specialised advisors.

With an extensive network of more than 80 lenders, we are well equipped to discuss the range of products presently available to you. We encourage you to reach out to us via telephone or live chat to explore your options further.