Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Scottish staycation surge boosts buy-to-let investment interest

Highlands and Islands tops list of most-profitable holiday-home areas.
Highlands and Islands tops list of most-profitable holiday-home areas.

Aberdeenshire and the Highlands and Islands are in the top most-profitable places in Scotland to own a holiday home, a new report has revealed.

The recent survey shows that demand for holidays in Scotland has hit an all-time high this year, with over 76% of Scots holidaying at home and a third of Brits planning to visit.

The Scotland Staycation Index 2021 from Sykes Holiday Cottages highlights a 92% occupancy rate for its Scottish holiday lets this summer, and a 65% increase in enquiries from second homeowners and investors looking to get into holiday letting.

Cottages like Spinnyfield in Fort William are fetching higher prices due to the staycation boom.

The Staycation Index analysed Sykes Holiday Cottages’ booking figures, consumer research and revenue data to reveal all about Scottish staycations, while also showing the numbers turning to holiday letting as an investment.

The research reveals the highest-earning regions for holiday letting in Scotland, with the Highlands and Islands, Perth and Kinross and Aberdeenshire commanding the most rental costs.

In fact, holiday-let owners in Scotland can expect to earn an average income of £16,000.

Interest in second home investment

However, earlier this year the Scottish Government announced it was considering potential restrictions on second-home ownership in Scottish tourism hotspots to free up housing stock for younger home owners and locals, and to create more affordable homes.

Already 25 of Scotland’s 32 councils have removed the 10% council tax discount on second homes in an attempt to discourage second-home buyers. In Scotland’s tourism hotspots, Highland Council, Moray Council, Aberdeen City Council and Aberdeenshire councils all charge 100% council tax on second homes.

Second-home buyers also face having to pay a dwelling supplement of 4% on top of the Land and Buildings Transaction Tax on the purchase price.

Holiday homes such as Wardlaw House, Inverness-shire, with Unique Cottages, are popular with tourists seeking some Highland luxury.

Second homes tax

Also worth bearing in mind are new tax changes that affect the sale of second homes and rental properties by UK residents. New investors, and those who are selling on their holiday homes to investors, are now liable to pay capital gains tax (CTG) within 30 days of selling their second home.

Tax planning specialist and director of accountancy firm Douglas Home & Company Sheryl Macaulay said: “The property market is buoyant at the precise time that many investors are thinking of selling up. Meanwhile, they are exactly the people who are going to be hit by the time pressure to report capital gain.”

Busiest summer on record for Scots holiday-let owners

However, the prospect of additional costs and fast CGT turnaround does not appear to have deterred would-be buyers who are likely to recoup the council tax costs in rentals. In fact, holiday-let owners in certain areas of the country can expect more than double the return of investment compared to buy-to-let properties.

With foreign travel restrictions still subject to change, Sykes’ Index highlights a 22% uplift in Scotland holiday let bookings for this summer compared to 2019, and a 46% increase for autumn and winter.

Plus, a quarter (24%) of Scots say the pandemic has made them more likely to consider holiday letting as a means of providing extra income at some point in the future.

High demand for luxury stays

For those weighing up where to invest, the Highlands and Islands is the most lucrative destination, with an average revenue of almost £19,000 for a three-bedroom property annually. It is also the most popular region for travel in Scotland in 2021, according to Sykes’ booking data.

Perth and Kinross and Aberdeenshire follow closely behind as top-earning regions, with both also featuring in the list of popular destinations for bookings this summer.

The analysis compared owners’ rental income with Scottish Government rental figures, along with house price data from Home.co.uk, to reveal the areas with the strongest return of investment (ROI) in Scotland.

A stronger staycation market in Scotland will likely remain a fixture for years to come

Graham Donoghue, CEO, Sykes Holiday Cottages, said, “As a proud Scot myself, it’s easy to see why Scotland is a firm favourite amongst holidaymakers.

“And with the appetite for staycations in Scotland reaching new heights, our holiday let owners are generating more revenue than ever before. The growing attractiveness of this investment opportunity is also fuelling more and more new owner enquiries for properties based in Scotland by the day.”

Back-to-back bookings

Susan Hunt, owner of a two-bedroom holiday home in the Highlands, said: “It’s obviously been a challenging year for the entire travel industry, but we can’t believe just how much bookings have bounced back. This year is set to be one of our busiest yet, with back-to-back bookings over summer and 2022 bookings already rolling in.”

Save us from becoming the land of holiday homes! Sutherland councillors back plans to breathe new life into its most fragile communities

SNP promise young people extra help to find affordable housing amid rural ‘crisis’

Already a subscriber? Sign in

[[title]]

[[text]]