Exploring the UK property market, short-term and holiday rentals have proven lucrative due to tax changes and platforms like Airbnb. But where’s the prime investment location?
Vanquis Bank analyzed data from 21 major cities to determine potential earnings from Airbnb and permanent rentals. Out of these, seven cities, including Bath, Belfast, Brighton, Cardiff, Edinburgh, Manchester, and Newcastle, showed that listing spare rooms on Airbnb for one night per week could yield more than full-time renting.
Cardiff
In terms of profitability, Cardiff emerged as the leading city for Airbnb, where homeowners could earn 86% more than traditional renting.
By hosting a room on Airbnb for 52 nights annually in Cardiff, the potential earnings amount to around £6,344, a substantial increase compared to the average rental income of merely £3,408.
Belfast
Belfast secured the second spot in terms of Airbnb profitability, as hosts could earn around £4,108 through Airbnb, which is 39% higher than the average rental income of £2,964.
Cambridge
In contrast, Cambridge emerged as the least lucrative city for Airbnb. Homeowners could anticipate an annual earning of only £3,744 through Airbnb, which is 35% lower than the average rental income of £5,772.
London
London emerged as the prime city for traditional renting, offering homeowners the potential to earn £8,126 annually, in contrast to the £6,084 achievable through Airbnb.
Advantages of Airbnb Investment in the UK
Investing in a UK property demands meticulous calculations and analysis. Here are the top 5 reasons why opting for Airbnb investment in the UK is a smart decision:
1. ANTICIPATE HEIGHTENED RETURNS
Strategic property selection and targeting the right audience can lead to increased profits. Short-term rentals often offer better returns compared to long-term options, thanks to flexible pricing.
2. THRIVING UK MARKET
Despite the pandemic, the UK boasts a rapidly expanding market, showing no signs of slowing down. As per recent Airbnb news, the top 10 UK cities are trending domestic travel destinations.
3. BLENDING LEISURE AND EARNINGS
Imagine owning a holiday home while sipping tea and making money. With Airbnb, you can effortlessly reserve dates for personal use, inviting friends over. A property investment with added perks!
4. MORTGAGE: SETTLED!
Initial concerns about mortgage payments often trouble new investors. As your Airbnb property gains income traction, mortgage payments become a worry of the past.
⭐ Pro tip: Once mortgage obligations are met, you can explore investing in a second property!
5. OUTPACING CONVENTIONAL RENTALS
Typically, a consistently occupied Airbnb property can yield greater returns than standard rentals. How? Long-term tenants pay a fixed monthly rate, whereas Airbnb guests can fetch variable nightly rates, especially during peak seasons.
Airbnb as a passive income:
Based on data from AirDNA, short-term rental hosts achieved their highest average yearly earnings in 2021, reaching £56,000. While a slight 5% decline is projected for this year due to increased supply and reduced rates, stability is anticipated, followed by further growth in 2023. Despite inflation and soaring fuel costs, recent surveys indicate minimal impact on American travel plans, indicating the resilience of these forecasts against economic challenges.
If you’ve been hesitant about venturing into short-term rental investment due to its complexity, your concerns are valid. Managing a vacation rental involves multiple intricacies, from guest satisfaction to maintaining positive reviews. This is where an experienced and reputable vacation rental property manager proves invaluable, justifying their fees.
If you possess or discover a property with potential as a splendid vacation rental, consider the financials and assess whether engaging a property manager could make vacation rental hosting a viable pursuit. You might realize that becoming an Airbnb host can be a pleasant and profitable experience.
MORE Serviced Accommodation blogs HERE:
Serviced Accommodation Mortgages
Does Section 24 Apply To Serviced Accommodation
The Ultimate Guide To Serviced Accommodation
Download NOW
4 Simple Steps To Becoming Wealthy Through Property