Autumn 2022 Investment Trends
Why You should be turning your clients on to the Holiday Property Investment Trend
Much of the last two years or so are probably years we want to forget in the property and investment markets. If you are anything like our firm, the last years have been very much about nurturing and consolidating clients’ portfolios.
In many sectors the guidance has been to “Hold Fast” on any major acquisitions or disposals.
The market has struggled through. And the Government’s pushing through of private landlord reforms making the once lucrative Buy to Let market now more elusive. So it can be difficult to offer strong investment sector recommendations right now.
Holiday Property Investment Returns Exceeding the Market
The last review of commercial property auctions saw GIY of 4%-5% touted as strong investments. There are better yields – yes, but on scrutiny there was usually a “subject to” or “if fully let“ clause attached.
So where is the clever money going? Are we now continuing back online to a rather shell shocked market place? Well, if you look at the reports – and there are lots, as recent years’ market shocks have kept on coming. Many market indicators are pointing towards the Holiday and Leisure Industry as the coming and strengthening investment trend.
Ways to Fund Holiday Property Investments
Hodge Bank produced a recent evaluation on the bounce of the holiday property let sector. The bank backed their report by launching a new mortgage designed for owners looking to buy or convert to a holiday property.
Hodge Bank’s business development director, Emma Graham, pointed out that the average price for a holiday home in in April 2021 was £423,537, since when the market has hardened. It’s not just homes by the sea which made up 59% of those sales, but hot on the seaside’s heels are country properties at 31% of the total.
Hodge is one of a few lenders who are now looking at this market with real interest, as a response to Airbnb and others who have created a very lucrative income for new investors to focus on.
Research from OnePoll states that 36% of Brits would love to own a holiday home, so companies like Hodge appear to be ahead of the game.
Where to Head for – Where’s Hot?
The Sykes Staycation Index 2021 highlighted the Southwest of England, North Wales and Cumbria as the most popular and fastest growing areas for holiday home requirements.
Therefore, what can your clients expect from such an investment?
Ways to Manage Holiday Property Investments – There are a couple of options:
Self-managed – usually good for people living in the same area as their property. Thius is where they handle everything and keep 100% of the income.
Managed – there are many holiday management companies and do not necessarily need you to have the property on a site to have a management company running the lets for you. The market rate charged by management companies is normally around 30% of the income. But weekly rents on holiday properties are in many cases higher than you would get from a monthly buy to let, so it is a strong consideration to get an expert to handle everything.
Holiday Park purchase – New parks are no longer the Hi-de-Hi resorts of old and they offer a wide range of properties each with good returns for investors. A holiday park is normally a well run complex with great leisure facilities that keep customers coming back for more. Even rainy days in August can be fun; when you are in a high quality spa looking out at the downpour. At the same time, the kids go mad on the water slides – indoor and wet. Management fees are as outlined above. Holiday park investments do make good sense and your property benefits from national advertising and the park’s attractions.
Holiday Property Trend Benefits – What’s not to like?
But the best part of owning a holiday home is the double benefit of both earning and having a place to relax.
The season for holiday lets is extended again – as Christmas and New Year holidays as well as Easter and half term breaks all add to the busy and longer season. Autumn, winter and spring holidays all extend the traditional summer season. Most valuations take 30 weeks as a standard annual earning capacity, but that is changing. With the “working from home” surge, many owners are filling their off-season with long weekend breaks. And long weekend rates are not much less than their weekly rates.
Here’s How to Invest in Holiday Property
Mulberry House Properties have a wonderful development in the South West of England offering investors 12.4% plus returns on a brand new, luxury holiday villa. This figure is based on a 30 week season giving the owner a further 22 weeks to enjoy their delightful country escape. For more details call Mulberry House Properties on 01793 493 099 or email us at
So the question is: what are you waiting for?
Whether you would like to discuss various opportunities with ourselves at Mulberry House Properties or get advice on how to create a home into a holiday let, get in touch.
But whether it’s with Mulberry House property investment experts or with another adviser: you know that this holiday property investment market is going to be around for a while. You need to get your investment client involved.