Once lockdown restrictions are eased, UK staycations will likely undergo another boom. Will 2021 be the right year to invest in short-term holiday lets and where will be the best areas to invest?
Demand for holiday rentals in the UK have been on the rise in recent years. And due to the coronavirus pandemic, a surge in bookings for short-term holiday lets is forecasted once lockdown restrictions are eased. In the next year, more holiday-makers will likely stay in the UK and flock to short-term rentals.
The travel industry is expecting international travel to still be under certain restrictions for some time. This will cause the local holiday market to see a revival. As successive lockdowns and the COVID-19 pandemic have taken their toll on people across the UK, taking more local holidays will be even more appealing once restrictions are lifted.
After being advised to stay at home, many will be itching to get away quickly. Additionally, in many cases, a short-term holiday let can require no human interaction, making it more appealing during COVID-19. Booking, queries and payment can all take place online via an app.
The rise of the staycation
In the past few years, the short-term letting sector has seen a lot of growth. With the rise of the staycation, short-term holiday lets are big business and will be in the coming years too. A growing number of buy-to-let landlords have branched out into short-term lets. Holiday rentals have the potential to be more rewarding than long-term rentals, especially in the right location.
It’s becoming more common for holiday-makers to want to say in private accommodation across city, rural and coastal destinations. One of the most popular and successful booking apps, Airbnb, has played a large role in the short-term rental boom. The app has made it easy for both travellers and holiday rental owners.
Additionally, as more people are becoming increasingly environmentally aware, the number of individuals taking personal responsibility for the planet continues to increase. This has caused a number of people to choose to holiday near home rather than fly abroad. This will continue to lead to more staycations, which will further boost the holiday lettings business in the UK.
In 2020, last-minute ‘minications’ became extremely popular. After lockdown restrictions were eased last summer, Britons scrambled to book staycation holidays in the UK. And this will likely happen again once restrictions are eased.
What are the best areas for holiday lets?
Staycations will boost the short-term rental market in some areas across the UK. Holiday lets in the outdoor activity market will likely be especially busy in 2021 and beyond.
With these types of holidays, travellers are looking for a base to explore with a range of activities on the doorstep like hiking and cycling. And as a nation of pet owners, many UK holiday-makers also wish to bring their dogs with them on holiday too. This is often much easier to accommodate in a holiday rental than a hotel.
During the staycation boom of 2021 and the coming years, the 15 national parks across the UK are expected to be especially popular. In these areas, demand will likely outstrip supply. As one of the UK’s largest national parks, the Lake District will be an especially popular choice for staycations, along with the nearby Yorkshire Dales.
These nationals parks are home to some of the best walks, cycle rides and lakes in the UK. Both areas have been enticing travellers for years and will only become more popular in the years to come.
The benefits of investing in short-term holiday lets
If done right, landlords can earn significantly higher yields for short-term holiday rentals than long-term rentals. Many holiday lets make more in a week than a buy-to-let makes in a month. Additionally, furnished holiday lets come with certain financial and tax benefits too.
With a growing number of landlords adding holiday lets to their portfolios, it can be a great way to diversify property investment portfolios. On top of that, Brexit and COVID-19 are expected to further strengthen this market. With the vaccine rollout, the future looks brighter for the sector as more normality will likely return later in the year.
The value of the pound has also taken a hit since the EU referendum in 2016. Poor exchange rates have made staycations more attractive to UK holiday-makers. On top of that, this has made it cheaper for foreign nationals to visit the UK. This will cause a further boom in UK tourism in the coming years.
At BuyAssociation, alongside our build-to-rent and traditional buy-to-let investment opportunities, we also offer a range of options available on a short-term let basis. Look through our investments page and sign up for free for additional information.