There has been a significant increase in the number of holiday let companies being set-up, as second-home owners look to cash in as overseas travel restrictions boost demand for short-term rentals across the UK.
The rate at which holiday let firms are being set-up has more than doubled during the pandemic, as second-home owners look to offset their costs amid a booming UK staycation market.
New data produced by Hamptons International reveals that 1,401 holiday let companies were incorporated in the first six months of 2021, up 83% from the corresponding period in 2020 and 119% on 2019.
The growth in holiday let companies has easily outpaced buy-to-let company set-ups, which were up 61% on 2019 levels, according to the research.
The figures, produced by the estate agency using Companies House data, show a steady rise in the number of holiday let companies from around 2014, with an acceleration in the past two years, as restrictions on overseas travel has boosted the UK second-home market.
Aneisha Beveridge, research director at Hamptons International, said: “A lot of people who fall into this category are the lucky few who haven’t had their income affected by the last year. They’ve racked up some savings and they’ve decided that putting it in property is a fairly safe bet. If you can also generate an income that covers the mortgage, that’s a win-win.”
According to Beveridge, 93% of those incorporating for holiday lets owned only one mortgaged property, which pointed to the use of company vehicles by individuals rather than large corporations holding multiple holiday homes.
She pointed out that only a small proportion of holiday homes were acquired for cash and held within a company.