Holiday home owners make money as staycation demand shows no signs of slowing down
A staycation boom is expected for the Easter weekend, highlighting the investment opportunities of vacation home ownership. rental operator Sykes Holiday Cottages analyzed income data, as well as house prices, to explore the long-term potential of holiday letting across the UK.
The Holiday Let Outlook 2022 report also features consumer research, booking figures from Sykes and information from the rental data and analytics firm. AirDNA, to paint a clear picture of the UK vacation rental market. Blaenau Gwent in south east Wales tops the ranking of the best places in the UK to invest in a holiday rental, according to the report.
With house price growth currently at 12% year-on-year and an average earning potential of almost £20,000 a year, the area offers excellent long-term potential for anyone looking to invest. Denbighshire and Rhondda Cynon Taf follow close behind in the new rankings, while major regions of England that make the list include Tyne & Wear and Lancashire.
Meanwhile, the Isle of Bute in Scotland came fourth. The easily accessible island was the only region in Scotland to feature in the top 10, but Fife and Dumfriesshire were not far behind. Location and amenities are two of the most important factors in the success of a vacation home. So, in the listed regions, any property must also be well located and offer desirable facilities to enhance the investment potential.
According to the survey of vacation home owners, a quarter only started renting during the pandemic, with the vacation rental boom fueling a surge in second home owners and investors entering the market. In fact, the sector continues to strengthen, with bookings for Sykes vacation rentals in 2022 up 35% from pre-pandemic levels – a number that is expected to increase further as we approach the coming months. ‘summer.
The consumer survey found that 84% of vacation owners said bookings for 2022 were stronger than ever, with the same number believing the trend will continue to grow over the next five years. With stay-at-home holidaying on the rise, Sykes’ report reveals the average holiday rental owner earned £28,000 in income from their holiday rental last year, up from £21,000 in 2019.
For those weighing where to invest in the short term, Cumbria and the Lake District top the list of highest earning holiday hotspots according to income figures from Sykes, with holiday rentals bringing in an average income of £44,000. Devon and Dorset follow close behind as the highest earning regions, with an average annual income of £35,000 and £32,000 respectively, while the Peak District has lost its top spot, falling to fourth place in the General classification.
For those looking to maximize the revenue potential of their vacation rentals, Sykes’ analysis found that a hot tub is the biggest lucrative feature they could have – adding around 49% to annual revenue. Revenue figures also suggest luxury amenities such as open fires could boost revenue by an average of 19%, while a pandemic-fueled rise in pet ownership has allowed properties pet-friendly now earn 9% more, on average.
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Graham Donoghue, Managing Director of Sykes Holiday Cottages, said: ‘The shift to staycations had already started before the pandemic, Covid has just accelerated this trend. And while international travel is getting easier, we now have new types of staycationers who are here to stay.
“The numbers speak for themselves – bookings so far this year are up 35% over 2019 and the average income of a vacation rental owner is up by almost the same amount as last year. compared to 2019 – demonstrating the incredible investment potential vacation rental can bring.
“As the UK travel sector grows, this will continue to have a positive impact on the country’s economies which are dependent on tourism, particularly in coastal and rural areas. In fact, nine out of 10 vacation rental owners we surveyed believe that tourism strongly benefits the local areas around their vacation homes.
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