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The idea of a UK holiday home never seems to lose its appeal. But in the past 18 months they have become more popular than ever — for good reason.

Staycations have boomed thanks to Covid, with tourist body VisitBritain anticipating over 50 per cent more domestic holidays this year than in 2020.

Using a holiday home not only as a personal bolthole, but as a nice little earner has also become fantastically popular.

In June, there were 10,290 active Airbnb listings just in Cornwall alone, as people flipped their properties to bag extra cash through so-called short lets.

So if you want to join the holiday home craze, here are seven golden rules to follow.

Contact us today to speak with a specialist Holiday Let Broker to discuss how we can assist you

1. Lock down a location 

You may have your favourite locations: after all, you will be staying in the new home, as well as letting it out. 

But if you want to follow the 2021 Government statistics, the most popular places to holiday in the UK this summer were the South-West — way ahead on 24 per cent — with North-West England, Scotland, Yorkshire and East Anglia next up. 

Or if you want to short-let your property, interiors firm Crafted Beds has worked out the average cost Airbnb hosts charge in different cities, which are more popular than rural locations for two or three-night breaks. 

Top comes Newcastle on an average £122 per night, followed by Leeds, York and Exeter, all about £120.

2. Size matters

Your budget may determine this, but if you can, look at the likely visitor market for your area. 

If the location is off the beaten track and quiet, a small property appeals for romantic weekend bookings or longer periods for walkers. 

If you are looking at a beach holiday home, it’s likely to attract families and groups of friends, so a larger property is the order of the day. 

3. Find the funding 

Independent finance service Moneyfacts says that just 74 holiday let mortgages were available in August 2020; now there are 186. However, there are many options. 

‘A holiday let mortgage is designed for those borrowing against a property let weekly or on a shorter basis such as Airbnb. 

‘It differs from a buy-to-let mortgage designed for properties let longer-term.

‘And a holiday home mortgage is different again as it’s for the owner’s personal use,’ says Mark Harris. 

Discover our Holiday Let Mortgage Broker services.

4. Good credentials

James Greenwood, of Stacks Property Search, says: ‘Open-plan works well for holiday lets, but separate utility space is worth a lot. Storage allows the owner to keep their own stuff while renting out. Parking is a strong selling point.’ 

His Stacks colleague Clare Coode — who lives in Cornwall — adds: ‘Think about your online appearance: property that’s Instagrammable always helps. 

‘Location-relevant fixtures like marine colours and panelled walls in seaside locations are good.’ 

No matter how lovely the home, you’ll need to equip it well; quality furniture and fittings that will take robust wear and tear (and pets if you allow them) add to the bill. 

Schofields Insurance, a specialist in holiday lets, suggests £15,000 to upgrade the interior of a two-bedroom cottage.

5. Hire an agent

The likelihood is your holiday home is some way from your main residence, so being on the spot for every change of tenants is difficult. 

Agents charge 20 to 25 per cent of the booking fee. It sounds a lot, but it covers cleaning, laundry and key handover. 

On top, the agent will advertise, answer enquiries, take the bookings, plus handle emergencies. 

And agents’ fees are tax deductible. 

6. Take on tax 

The rules suggest the most efficient property is a furnished holiday let, rented out for no more than 31 consecutive days to one customer. 

In addition, the furnished holiday let must also be available to the public for at least 210 days of the tax year and let out to paying customers for at least 105 days. 

7. Add on insurance

It’s dull, but essential. Even if you’ve let your holiday home out for a few weeks, most insurers will not cover Airbnb-style short lets. 

So you may need separate cover. GoCompare is the first service of its type to ask insurance applicants if they want to host short-let tenants and if so, they have to pay for additional cover. 

By GRAHAM NORWOOD FOR THE DAILY MAIL

Source: Daily Mail

New research by Hoseasons suggests the staycation boom will continue into 2022 despite the easing of international travel restrictions.

Research by Opinion Matters on behalf of the UK tour operator between August 27 and September 9 this year showed 83% of those who took a staycation this year hope to do so again next year, with 24% already planning their next trip.

More than a quarter of holidaymakers (28%) polled preferred a staycaytion over a holiday abroad while just over half, 52%, planned to take one of each in 2022.

The research also revealed a trend for a ‘sleighcations’ with more than one in five saying they were booking or considering a winter UK break.

Contact us today to speak with a specialist Holiday Let Broker to discuss how we can assist you

The results are based on two separate online surveys, with the first receiving 2,007 general respondents, and the second receiving 1,001, all of whom had taken a staycation this year.

In light of the research Simon Altham, group chief commercial officer at Hoseasons’ parent company Awaze, urged agents to encourage holidaymakers to book early for 2022.

He said: “Savvy staycationers are already snapping up the best breaks and securing the best properties to make sure they don’t miss out. We’re not saying 2022 is selling out already – it’s far too early for that given the incredible range of holidays the UK has to offer – but now really is the right time to start looking and booking.”

According to the research, the top reasons why consumers enjoyed a staycation were the comfortable and relaxing accommodation (34%), a change of environment (32%), less stress than going abroad (30%), and improved mental health (29%) while more than a quarter (27%) were pleased to support local economies.

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Consumers also cited the experience of UK holiday nostalgia (15%) as the reason they enjoyed a UK break in 2021, with more than a third (36%) naming fish and chips on the beach and more than a fifth (22%) saying building sandcastles was their favourite staycation memory.

Altham added: “It doesn’t matter if it was 50 years ago, 30 years ago, or more recently – the times we spend on UK breaks are some of the happiest many of us can remember. That’s why, after the year we’ve all had, it’s no surprise that so many staycationers are looking to relive the good times all over again in 2022 and create more special moments to treasure for many years to come.”

The results support booking data from Hoseasons’ parent company Awaze, which has reported that bookings for summer 2022 are up 82% compared to the same time last year for summer 2020, and up 62% for the whole of 2022.

The rise in demand for staycations, which has led many lodge and holiday park owners to expand their offering, has also resulted in Hoseasons more than doubling the size of its portfolio compared with this time last year.

The company has also launched a six-figure marketing campaign, centred on TV advertising, which invites consumers to ‘Relive the Good Times’ in 2022 and beyond. Ads air on ITV, Channel 4, and Sky Media networks until October 24 and feature Hoseasons’ range of self-catering holidays. The campaign is also being promoted on YouTube and email.

By Juliet Dennis

Source: Travel Weekly

Holiday let deals have more than doubled over the past year to 186 options, and the sector is predicted to grow further fuelled by short-term rental demand.

According to research from Moneyfacts, buy-to-let mortgage options available for holiday lets have gone from 74 in August last year, to around 186 options.

The research showed that 25 lenders were now offering holiday-let deals, up from 14 in August last year largely boosted by building societies.

Yet the average fixed rate for a holiday-let product has grown from 3.53 per cent in August last year to 4.14 per cent in September this year.

The report also cited research from Hamptons which founds there were 1,404 new holiday-let incorporations in England, Scotland and Wales between January and June, which is the highest since records began in 2007.

Moneyfacts finance expert Rachel Springall said that it was “positive” to see the growth in product choice but it was still a relatively niche market with less than 200 deals available.

She said: “Whether the appetite for staycations falls in 2022 is unknown but for the moment it’s evident landlords are taking advantage of the opportunity to earn an income through holiday lets. Those who may have saved some additional disposable income during the UK lockdown, or are looking for alternative investment opportunities, may then be keen to get involved.

“Undertaking thorough research into popular locations, weighing up tax benefits, reading up on rules regarding residency periods and other potential expenses outside of utility bills can feel daunting, so seeking advice before entering an arrangement is wise.”

Holiday let demand expected to grow

Brokers overall said that they expected demand in the holiday-let sector to continue to grow, adding that they were already seeing an increase in enquiries.

Matthew Rowne said: “Holiday lets are going to be a big thing over the next three to four years, we have already seen a massive increase in enquiries.

“We are in a privileged position where a lot of lenders will come to us about where they sit in the market, so we know other lenders that will imminently come into it.”

He added that the sector is likely to continue to expand as people may not be comfortable with travelling abroad, therefore staycations would remain popular and appeal to landlords.

He added that a benefit of the UK holiday-let market was that it wasn’t as seasonal as traditional holiday lets in Spain, for example, owing to the popularity of city centre breaks in the UK as well as country locations which have more year-round appeal.

Contact us today to speak with a specialist Holiday Let Broker to discuss how we can assist you

Rowne added that the “incredibly high” pre-Covid yields for holiday lets had grown even higher.

Nicholas Morrey said that the boom in UK holidays would likely be around for a few more years as restrictions on travel and the impeded ability to go to Europe due to Brexit would encourage people to holiday at home.

He added that lenders had been reviewing their holiday let criteria to increase or maintain their market share, with some re-entering the space altogether. Although none of the big six lenders had stakes in the space currently.

“This year is not typical of the demand there will be in years to come”

John Phillips said that he had seen growing demand from clients but said that they should take a “note of caution”.

He said: “It makes sense that people want to enter the market as the returns on holiday-lets can be significant. The market this year is not typical of the demand there will be in years to come, however.

“With Covid there has been a huge demand for staycations, but once everyone can go abroad again, it is unlikely that as many people will look to the UK for their holiday.”

Phillips added: “Many of the people looking to buy are professional landlords, but even then, I would advise them to look at where the market is going and ensure that they can afford the property even when we return to a more normal scenario with the bulk of the population holidaying overseas.”

Morrey said that criteria was still restrictive.

He said: “What hasn’t changed much is the acceptance criteria which is still quite tight or onerous. In defence of lenders this is a relatively high-risk lending strategy since if or when holiday-let borrowers struggle to rent out these properties they will have to find hundreds of pounds every month until they do or sell up. As there are no assured shorthold tenancy in place the income streams could dry up very quickly indeed.

Discover our Holiday Let Mortgage Broker services.

“In a few years lenders will have to look at this as a possible outcome for the duration of the mortgage, which could be 20 years or more – not two or three.”

He added that Airbnb was still quite a contentious area for lenders, as the list of those who would agree it as an income route was “quite short but growing”.

Morrey said that it would be challenging for lenders to assess this variable income stream, but more work should be done to work with Airbnb as there is more data to support applications than there was a few years ago. He also noted that the data would show the effect of the pandemic, Brexit or other issues over a period of time.

He added: “Currently, given the sheer numbers of properties on Airbnb, I fear many second home-owners are using Airbnb without permission so I suspect the problem for lenders with borrowers breaking their terms and conditions is here already.”

By Anna Sagar

Source: Mortgage Solutions