Locations such as Cornwall, Devon or Suffolk are most likely to spring to mind when you consider the prime holiday hotspots in the UK.
But you will need to look further north to find the places where your holiday let will offer the best business potential.
According to Sykes Holiday Cottages, the top place to invest in a UK holiday home is actually Cheshire. Hot on its heels are Anglesey in Wales and the Lake District which come second and third respectively in the rankings.
It’s all to do with property prices and the earning potential of the dwellings. In Cheshire the average house price is £256,500 and the average potential revenue, meanwhile, is £46,000 a year.
Sykes said the region also had a destination offering plan in place for the future, which will attract even more domestic visitors.
Meanwhile, Anglesey had an average house prices of £249,169 with potential revenue averaging £37,867 and the Lake District the typical property was £295,307 with owners gaining a possible £43,789.
The figures were published as part of Sykes Holiday Letting Outlook Report 2023, which aimed to establish the long-term potential of holiday letting across the UK.
It also found a quarter (25%) of owners were ‘very worried’ about the potential of new regulations or fees being enforced following the government’s recent Call to Evidence.
But despite this sentiment amongst holiday let owners remained strong and the demand for staycations still appeared to be growing following the boom during the pandemic. Bookings for Sykes’ holiday lets in 2023 were up 9% compared to last year already.
The consumer research found that 50% of holiday let owners say bookings are still stronger than ever post-pandemic, with 63% planning to grow their holiday let portfolio over the next five years.
Sykes’ report also revealed the average holiday let owner earned £24,000 in revenue from their holiday let last year, up 59% from 2019.
They also typically spend around £7,400 per year on expenses for their holiday let, with the highest costs being utility bills and property maintenance.
Graham Donoghue, CEO, Sykes Holiday Cottages, said: “Our new investment analysis has identified the locations to watch when it comes to investing, and I would encourage anyone considering making the leap into holiday letting to get in touch to find out how else they can make the most of their investment.
“As many are clearly aware, the UK government is currently looking into concerns from some quarters about the impact of holiday letting on the housing market, but at this stage our view is that any immediate changes for the sector are quite unlikely amid other priorities in government.
“Clearly, it’s vital that the market operates responsibly and doesn’t negatively impact communities. But it is also important that the positive impact of the sector is not ignored, with any changes to how it operates risking having unintended consequences on local economies and job opportunities.”
Top 10 picks for staycation accommodation investments (Source: Sykes)
| Location | Average house price | House price growth YoY | Average revenue of 4-bed holiday let | |
| 1 | Cheshire | £256,526 | 2% | £45,549 |
| 2 | Anglesey | £249,169 | 10% | £37,867 |
| 3 | Lake District | £295,307 | 8% | £43,789 |
| 4 | Lincolnshire | £241,092 | 4% | £41,655 |
| 5 | Angus | £182,628 | 4% | £30,318 |
| 6 | Peak District | £285,734 | 5% | £41,752 |
| 7 | Dumfries and Galloway | £177,625 | 2% | £21,445 |
| 8 | Norfolk | £303,139 | 4% | £32,579 |
| 9 | North Yorkshire | £228,346 | 2% | £33,529 |
| 10 | Pembrokeshire | £254,675 | 7% | £28,567 |
