The cost of property has skyrocketed during the pandemic. While this might leave some investors wary, the right strategy could be a fantastic choice for both new and seasoned investors. Buy-to-let properties – and holiday let investment properties in particular – are a great way in to property investment at the moment.
The rise of the ‘staycation’
The landscape of the travel market has changed dramatically over the past two years. As holidaymakers try to avoid costly tests and close-confinement transport, “staycations” are becoming increasingly popular.
Some destinations across the UK have been consistently desirable – but with a sudden rise in demand for holiday property, other locations have been receiving renewed interest.
Overseas territory in Spain and France was once the natural choices for anyone looking to invest in a second or holiday home, as property prices were low while potential returns were generous and secure.
However, with concerns growing over the financial implications of owning international property following Brexit, previously advantageous locations overseas are looking less prudent for investment property.
Add to this rocky currency markets and a worryingly insecure sterling versus the Euro, and any rental income needing to be moved across currencies is looking markedly vulnerable.
With this in mind, it’s unsurprising that investors are feeling a little less inclined towards turning to cheap villas and looking at promising choices closer to home.
A Scottish destination
Tourists and investors alike are moving away from the increasingly unaffordable destinations like Cornwall and Devon, in favour of a different scenery – in Aberdeenshire and the Highlands.
Admittedly Scotland might not be the first thought in a traveller’s mind while planning a trip, but the wild beauty and relative ease of access of the landscape has captured the imaginations of those looking for a change of pace without having to whip out their passports.
In fact, the Scotland Staycation Index 2021 declared a whopping 92% occupancy rate for Scottish holiday lets last summer, with enquiries from investors and second homeowners increasing by 65%.
According to the study, Perth and Kinross, Aberdeenshire, the Highlands and Islands providing the greatest income for those with property to rent, with average income of around £16,000.
It’s not just summer holidays in Scotland that have been beckoning those with itchy feet and packed suitcases.
While Scottish summer lets have grown in popularity by 22%, autumn and winter lets have increased by almost double that, with 46% more interest last season than in the previous year.
The index also showed that while buy-to-let properties in Scotland will yield good results as long-term rentals, due to profitable rent in comparison to the purchase price of property, it is holiday lets which seem to bringing the best return on investment.
For instance, a traditional two-bedroom buy-to-let in the Highlands and Islands promises around 5.9% ROI, while a holiday let of the same size might offer closer to 14%.
Even with the effects of the pandemic easing, the international travel industry has been slow to recover, while the UK travel industry sees an enormous boom.
Many people got badly burned with moved flights, cancelled accommodation or Test and Trace pings if they braved an aeroplane over the course of the pandemic, so even as travel restrictions ease many are still reluctant to risk the inconvenience of a cancelled trip.
After all, why go through the bother of visas, insurances, phrasebooks or aeroplane food when you could clamber into the car and drive up to a luxury let with minimal bother?
The appeal of domestic travel for UK travellers shows little sign of waning, and the price of property hasn’t yet caught up with the earning potential in these trending areas of Scotland.
So, what should investors be doing to ensure they don’t miss out on this budding market and make the next steps in securing a holiday lodge investment in Scotland?
Scottish holiday home investments with GladePark Investments
By getting involved in Scottish holiday home investments with GladePark Investments, you could capitalise on this dramatic shift without the costs or admin of a full purchase. Our holiday resorts Landal Barnsoul and Landal Belvedere buy-to-let plots are flexible, asset-backed investments – and require a significantly shorter minimum buy-in of just five years, with 110% buyback.
Taking the legwork out of choosing or running the rental yourself, you could buy yourself a piece of this profitable emerging market without the drawbacks. Your holiday property investment will be fully managed by Landal Greenpark, an industry leader in hospitality and tourism. If you have capital to grow, Scotland could be the place to do that.
To find out more speak to a member of our team by calling 01702 478 895.