The Surging Popularity of Short-Term Rentals in the UK

Jul 17, 2023

Over the past few years, the holiday rental industry in the UK has experienced a remarkable shift. Property investors no longer view traditional buy-to-let investments as the only viable option. Instead, short-term lets have emerged as the hottest property trend. With the increase in demand from families and individuals seeking “workation” trips, renting out furnished properties for a shorter period has become a gold mine for investors. In this blog, we will explore the pros and cons of furnished holiday let rentals and what property owners must consider before investing.

Factors Driving Growth

Various sources, the growth of short-term rentals in the UK has been significant in recent years. Here are some key findings and insights:

  • The UK Short Term Accommodation Association (STAA) report revealed that home-sharing platforms like Airbnb and had around 2 million listings in the UK in 2019, marking a five-fold increase since 2015. (source: STAA)
  • Additionally, the report found that London had the highest number of listings in the UK, with around 80,000 active listings in 2019. Edinburgh, Manchester, and Bristol closely followed.
  • The rise of short-term rentals can be attributed to factors such as the growing popularity of staycations, the affordability of short-term rental homes compared to hotels, and the demand for flexibility in remote working arrangements. (source: Rentalscaleup)
  • Many travellers prefer short-term rentals over traditional hotels due to the availability of more space, privacy, and amenities like full kitchens and laundry facilities. (source: Propertymark)
  • An Airbnb survey indicated that 55% of guests who booked through their platform in 2020 stated they would not have traveled if short-term rentals were not an option. This suggests that short-term rentals contribute to tourism and support local economies. (source: Airbnb)
  • Short-term rentals are increasingly popular for events such as weddings, festivals, and corporate retreats. In fact, Airbnb reported a 55% growth in bookings for stays of four or more people in 2019. (source: Airbnb)
  • The growth of short-term rentals is expected to continue in the coming years. Statista projects a 0.66% growth in the vacation rentals market in the UK from 2023 to 2027, resulting in a market volume of $4.76 billion in 2027. (source: Statista)

Advantages of Furnished Holiday Lets: Control, High Occupancy Rates, and Great Returns

A furnished holiday let is a property that comes equipped with all necessary amenities for short-term vacation stays. These amenities may include cookware, furnishings, bedding, towels, and other extras that attract guests seeking home-like comfort during their holidays. One major advantage of short-term lets is the control they offer investors. As the owner of a furnished let property, you have the flexibility to determine the rental price, duration, and target audience. This control allows you to maximize profits while also quickly adapting to market changes or customer demands.

Short-term lets offer several advantages over traditional buy-to-lets. They boast high occupancy rates, excellent returns on investment, and vacation-like accommodations. Occupancy rates for furnished holiday lettings are notably higher, with minimal downtime between guest stays compared to long-term tenants. In contrast, buy-to-let properties often experience high rates of tenant turnover, resulting in extended vacancies. Short-term vacation tenants typically stay in the home for only a few days or weeks.

The Lucrative Appeal of Short-Term Vacation Property Rentals

Returns on investment for short-term vacation property rentals are typically much higher compared to buy-to-let properties. According to recent data, the average rental rate for a furnished holiday let in the UK can be as much as double compared to a traditional property investment. In many instances, holiday rental properties can recover their investment in as little as three years.

One of the biggest reasons why people prefer furnished let properties is the vacation-like feel they provide. Furnished holiday properties usually come with perks like ready-made beds, stocked kitchens with fresh provisions, and other amenities that embody the feeling of a luxurious vacation stay. These added touches can make a significant difference in demand and price on the market.

While short-term holiday rentals can be enticing, there are also cons to consider. Short-term vacation rentals usually require more maintenance, expertise, and effort to keep them clean before each guest checks in. Compared to traditional long-term buy-to-lets, furnished holiday lettings also require a higher standard of upkeep, taking into account the extra wear and tear from rotating guest visits.

Domestic searches on Airbnb following key announcements

Domestic searches on Airbnb following key announcements


Overall, the growth of short-term rentals in the UK can be attributed to a variety of factors, including changing consumer preferences, advancements in technology, and increasing demand for flexibility and affordability. As the trend continues to grow, it presents opportunities for investors, landlords, and tenants to benefit from the benefits that short-term rentals offer.



This guide is intended solely for informational purposes and should not be considered as investment advice. For those in search of financial guidance, it is advisable to consult with a financial advisor authorised by the FCA, to receive regulated advice tailored to your investment choices.

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