Holiday Letting Outlook Report 2024

Welcome to the Holiday Letting Outlook Report 2024. An analysis of holiday letting trends and opportunities, alongside a look at what lies ahead for the UK’s holiday let owners.

The third edition of our yearly holiday rental forecast report delves into the insights of the UK's short-term accommodation sector following a dynamic 12 months. Staycations have surged in popularity over the last decade, and presently, there's an unprecedented demand for our UK holiday cottages.

We’ve analysed our own booking and income data to dig into how the market performed last year, and how things are shaping up for 2024 and beyond.

For a monthly view on how the holiday let market is performing, see our Holiday Letting Pulse Report.

In the report, we cover:

The state of the UK staycation market

Though holiday let owners understandably harbor concerns about recent changes, it's evident that short-stay accommodation continues to be a profitable and fulfilling long-term business venture for the majority.

Here are several pivotal insights derived from both our survey of UK holiday homeowners and our own booking data:

• 8% increase in bookings year-on year in 2023, up 71% versus pre-pandemic levels

• £24,500 average turnover of a UK holiday let in 2023, versus £24,000 in 2022

Hearing from current owners

As the driving forces behind the success of the market, we wanted to hear from the holiday let owners first-hand to see how they’re doing.

From who they are and what motivates them, to how the cost-of-living crisis has changed things, we surveyed 500 UK holiday let owners from across the market. Here are some facts and stats around holiday let owners in the UK:

• 60,000 enquiries from new owners in 2023, double that of 2019 volumes

• Half of owners are likely to buy another holiday let in the near future despite the recent changes

• 86% of owners say they are likely to continue to rent their holiday let

Building a profitable holiday let business

An analysis of our income data shows that the unwavering demand for Britain’s staycation market is clearly benefiting owners.

Despite the sector's evolving landscape, owning a holiday let continues to prove lucrative as a long-term business model, with average revenues showing an upward trend across the UK in 2023.

Let's examine the destinations that have experienced the most significant income growth between 2022 and 2023.

• Cotswolds

• Cumbria and the Lake District

• Dorset

• Cornwall

• Peak District

The three features that generate the most additional income were:

• Hot tubs

• WiFi

• Pub Proximity

Average costs of running a holiday let

In 2023, the average income for a holiday let owner stood at £24,500. The earning prospects for holiday let businesses in the UK remain robust, with the Cotswolds emerging as the highest-earning region in 2023.

Download the full report here for more details.

Key changes to to the holiday let sector

So far, the most notable regulatory or tax adjustments have been introduced in Scotland and Wales. However, the recent UK Budget also unveiled sectoral changes, such as the elimination of the furnished holiday let tax regime effective from April 1, 2025.

Key changes holiday let owners are worried about are:

• Higher rates of tax – and the impact it could have on profitability

• A tourism levy – also known as ‘tourist tax’ for holidaymakers

• A licensing scheme – already introduced in Scotland

Download the full report for more in-depth stats, data, tips and information

Destinations where income levels are up

Here's a brief look at the locations that have seen the greatest increase in income between 2022 and 2023.

• Seahouses, Northumberland +36%

• Bamburgh, Northumberland +25%

• Almwick, Northumberland +19%

• Alnmouth, Northumberland +17%

• Ambleside, Cumbria +12%

Challenging perceptions of holiday letting

There is currently a gap in evidence of our industry’s positive economic impact. However, at the same time, concerns have emerged as to its potential effect on the housing market, prompting a recent Call to Evidence by the UK government.

To help fill this gap, last year we commissioned Oxford Economics to undertake an independent quantitative analysis to understand the sector’s true impact – from the spending of tourists to the job opportunities created.

Promoting sustainable travel

What changes can be made to let your property in a more sustainable way? We’ve made it our mission to ensure the sustainable growth of the sector.

This includes working closely with holiday let owners to ensure properties are let in a responsible way that benefits local communities. Some efforts that can be made include:

• Encouraging guests to spend local by recommending local restaurants and attractions

• Ask guests to recycle and reduce energy consumption

• Ask holidaymakers to be respectful of neighbours

• Have connections with local businesses to offer guests discounts or guaranteed bookings

• Open their property to bookings year-round to avoid it being empty