The most profitable locations in Britain for holiday lets has been revealed – and the majority are not located anywhere near a beach.
Staycation favourite Cornwall is top of the rankings, with an average price per night of £84 for a room and £117 for a whole house.
A total of 476,910 bookings were made via popular holiday rental companies in the area last summer, according to analysis of Office for National Statistics data by the money website Wealth of Geeks.
The figures suggest that holiday lets in Cornwall took bookings worth £40million between the beginning of July and the end of September last year.
However, most of the top 10 are located in inner London, the research showed.
> SCROLL DOWN TO THE BOTTOM OF THE ARTICLE FOR THE FULL LIST
The most profitable locations for buy-to-let have been revealed, with staycation favourite Cornwall at the top of the rankings
The list of top ten places also includes several areas in London, including Westminster in second place.
The average price of renting a holiday let in Westminster is £133 a night for a room and £435 for a house.
With 304,790 holiday let bookings, it produces a revenue for the area in the heart of London’s west end of £34,441,270 for the summer period last year.
The calculations were based on bookings on Airbnb, Booking.com and the Expedia Group, with data taken from the Office for National Statistics.
The rental prices, meanwhile, were taken from Airbnb across 388 British towns, and the total revenue was calculated by multiplying the number of nights with the nightly cost of a room on Airbnb.
The revenue did not take into account any costs of running a holiday let, such as repairs and maintenance, nor did it factor in property prices.
All of the remaining locations in the top ten were in London except for one on the south coast.
This was Brighton and Hove, where average rental prices per night were £100 for a room.
In total, the data suggested that the British holiday rental market made £739,211,390, during the summer of 2023.
Michael Dinich, of Wealth of Geeks, said: ‘Holiday rentals play a vital role in the UK’s tourism industry by supporting local economies, providing accommodation to enhance visitor experience, and promoting tourism in diverse regions across the country.
‘Tourism also helps to promote awareness of lesser-known areas, helping to distribute tourist spending more evenly across the country.
‘While some destinations may experience seasonal fluctuations in tourism often in the summer months, holiday rentals attract visit year-round, helping to sustain economies and businesses during off-peak seasons.’
Chancellor Jeremy Hunt announced in this year’s Budget that the tax relief available for furnished holiday lets would be scrapped
The findings show that those looking to invest in the holiday lets market need to do their sums carefully before taking the plunge and committing to a particular area.
North London estate agent Jeremy Leaf, explained: ‘This data shows that it’s not just the prospect of beaches and more reliable weather which drives profitability.
‘It’s not just traditionally popular holiday destinations which produce the best returns so it’s vital that would-be landlords do their research carefully before investing.
‘The ability to make money depends on supply and demand, not just the attributes of an area.
‘At what level a landlord can rent their property for, after taking into account all expenses, is key and explains why areas such as Westminster and Camden are proving profitable, where they may lack the charm of a traditional UK holiday destination such as Cornwall.’
The British holiday rental market made £739,211,390, during the summer of 2023, according to the latest data
Tax crackdown
The data on the most profitable holiday lets follows a crackdown on the sector by the Chancellor.
Jeremy Hunt announced in this year’s Budget that the tax relief available for furnished holiday lets would be scrapped to help improve the availability of long-term rentals.
The move is due to come into force at the beginning of April next year and is widely seen as a way of bringing the tax regime of shorter-term lets more in line with longer term rentals.
Experts operating in the sector insisted that holiday rentals remained in demand ahead of the changes.
Graham Donoghue, of Sykes Holiday Cottages, said: ‘Staycations have been growing in popularity over the past decade and right now demand for our UK holiday cottages is higher than ever, with the average annual income of a holiday let owner up as a result.
‘Hotspot locations like Yorkshire, Cumbria, and Cornwall continue to see considerable demand and bookings across the UK for our holiday cottages have been up 11 per cent during the current Easter school holidays.
‘The demand we’re witnessing is particularly good news for our holiday let owners who have faced their own set of challenges recently. Despite changes, which we are carefully guiding our owners through, it’s clear that holiday letting remains a profitable and rewarding long-term business model.’
| Rank | Town | Nights | Median price per night (room) | Median price per night (house) | Median price per night (apartment) | Location revenue (nights x price per night) |
|---|---|---|---|---|---|---|
| 1 | Cornwall | 476,910 | £84 | £117 | £113 | £40,060,440 |
| 2 | Westminster | 304,790 | £113 | £435 | £147 | £34,441,270 |
| 3 | Camden | 172,500 | £123 | £140 | £156 | £21,217,500 |
| 4 | Hackney | 101,140 | £202 | £204 | £127 | £20,430,280 |
| 5 | Kensington and Chelsea | 167,770 | £113 | £115 | £145 | £18,874,125 |
| 6 | Brighton and Hove | 134,010 | £100 | £100 | £128 | £13,401,000 |
| 7 | Islington | 108,250 | £117 | £255 | £173 | £12,665,250 |
| 8 | Southwark | 104,290 | £112 | £116 | £131 | £11,680,480 |
| 9 | Tower Hamlets | 161,000 | £73 | £166 | £169 | £11,672,500 |
| 10 | Lambeth | 98,430 | £113 | £440 | £136 | £11,122,590 |
| 11 | Dorset | 121,880 | £88 | £120 | £131 | £10,725,440 |
| 12 | Hammersmith and Fulham | 92,140 | £111 | £123 | £146 | £10,227,540 |
| 13 | Gwynedd | 122,660 | £83 | £117 | £105 | £10,180,780 |
| 14 | Scarborough | 102,500 | £96 | £94 | £121 | £9,840,000 |
| 15 | Liverpool | 127,310 | £77 | £85 | £103 | £9,802,870 |
| 16 | Birmingham | 109,920 | £86 | £106 | £98 | £9,453,120 |
| 17 | South Lakeland | 106,450 | £88 | £119 | £116 | £9,367,600 |
| 18 | Bournemouth, Christchurch, and Poole | 112,040 | £78 | £117 | £120 | £8,739,120 |
| 19 | Pembrokeshire | 101,330 | £85 | £94 | £101 | £8,613,050 |
| 20 | Northumberland | 91,950 | £90 | £110 | £127 | £8,275,500 |
| 21 | York | 85,080 | £88 | £107 | £112 | £7,487,040 |
| 22 | Wandsworth | 77,700 | £95 | £160 | £138 | £7,381,500 |
| 23 | Bristol, City of | 81,700 | £78 | £111 | £115 | £6,372,600 |
| 24 | Cotswold | 61,650 | £102 | na | £100 | £6,288,300 |
| 25 | Belfast | 79,660 | £76 | £117 | £124 | £6,054,160 |
| 26 | Isle of Wight | 70,000 | £84 | £128 | £112 | £5,880,000 |
| 27 | Bath and North East Somerset | 71,190 | £81 | £99 | £94 | £5,766,390 |
| 28 | North Norfolk | 61,800 | £93 | £128 | £144 | £5,747,400 |
| 29 | Manchester | 100,480 | £57 | £76 | £109 | £5,727,360 |
| 30 | South Hams | 64,160 | £85 | £115 | £115 | £5,453,600 |
| Source: Wealth of Geeks | ||||||
This post first appeared on Dailymail.co.uk
