The Daily Telegraph - Saturday - Money
Invest in sun, sea and staycations
Melissa Lawford discovers the best locations to buy a holiday let across Britain and Europe
Britain’s holiday homeowners are raking in profits as travel restrictions and Brexit stretch the summer staycation boom far into 2021. A new shift towards holidaying in smaller rural areas means Polperro in Cornwall is the best place to invest in holiday lets in Britain, according to AirDNA, a data company.
It ranked holiday destinations using a combination of rental growth, bookings and rental demand for properties on Airbnb, the lettings firm. In Polperro, forward bookings in November were up 130pc year-on-year, while the average room charge jumped 52pc.
In Ludgvan, further west in the county towards the Penwith peninsula, the average charge per room jumped 73pc year- on-year. One holiday letting agent in the South West has reported a fourfold increase in bookings for next year.
Cornwall accounted for six of the top performing holiday destinations in Britain, with Calstock, St Columb Major, Newquay, Camborne and Ludgvan also occupying the top 10. But the other winners were widespread. Barrow-inFurness in Cumbria came in second place, followed by Middlesbrough in the North East. In North Lanarkshire in Scotland, November bookings were up 137pc year-on-year.
James Norton of Toad Hall Cottages, which manages more than 900 selfcatered properties in the South West, said: “We could have doubled our prices. Our bookings are up 300pc for the year ahead.”
In a normal year, interest in homegrown holidays would normally fade in the autumn, but “November was booked like never before,” said Mr Norton. Lockdown brought a wave of cancellations and rebookings, but the 2021 outlook is still strong.
Holiday-makers are channelling the money that they would have spent on foreign holidays into staycations. The more expensive properties that rent out for £4,000 to £5,000 per week and would typically only let for 22 weeks of the year are now already booked up for 35 weeks in 2021, said Mr Norton.
Carl Wood of Holiday Cottages Polperro, which manages about 40 holiday listings, said forward bookings for 2021 were “our strongest ever”.
Buyers are capitalising on the boom and the stamp duty holiday to invest in holiday lets. “One of our property managers used to get two or three requests a month to assess the rental return on a holiday let for a buyer’s mortgage application,” said Mr Norton. “At the moment she is doing 10 to 15 a week.”
Space and authenticity is key to Polperro’s success. Martin Brown, of Stratton Creber estate agents in south Cornwall, said: “In Padstow and Rock, the old fishing towns have been developed and famous people have spent a lot of money knocking down and rebuilding houses. You don’t get that in Polperro. The parish council just object to everything, it’s a conservation area.”
Polperro’s old streets are so narrow, it is effectively a car-free zone. “A lot of cars get stuck following their sat navs,” said Mr Brown, who is a former resident. “They get wedged in and tractors have to come and drag them out.”
Demand for property in the local area has been “absolutely bonkers” since holiday lets were allowed to reopen in July, said Mr Brown. Three quarters of buyers are purchasing second homes, up from 60pc last year, he said. Many are retirees and the majority are purchasing with cash.
“Everything is selling straight away and we often have two or three people fighting over the same property,” said Mr Brown. London buyers are key, but demand is also coming from Manchester, Staffordshire and Yorkshire.
In the countryside, the share of properties bought as second homes increased from 3.5pc in 2019 to 4pc this year, according to Hamptons International estate agents. In cities, however, it fell from 2.6pc to 2.1pc.
AirDNA’s research shows that across Europe, holidaymakers are shunning cities too, with the most popular places all in small and rural areas.
Polperro was the fifth best place to invest in holiday lets in Europe, while Russia’s northern region of Karelia, which stretches from the White Sea to the Gulf of Finland, was home to the two top performers: Sortavala and the Lakhdenpokhsky district.
These sit on the edge of Lake Ladoga by the Finnish border and came in first and second respectively. In Sortavala, future bookings made in November were up 189pc year-on-year.
Also high on the list were District de la Broye-Vully near Bern in Switzerland and Montrichard, a small town near Tours in France.