Investors have responded in force to the increased demand for staycation breaks in the UK this summer. Short-term accommodation is being snapped up, as investors seek out properties that will appeal to those holidaying somewhat closer to home than normal.
“From coastal properties to city centre apartments, we’re seeing investors seeking out short-term lets that will serve the staycation market. The market is booming this year and many investors are looking to capitalise on that by investing in newly completed buildings. Others are focusing on the medium term and opting for buildings that will complete in 2022 or beyond, with potential to appeal to corporate renters as well as holidaymakers.”
Dale Anderson, Managing Director, Fabrik Invest
One development that is attracting considerable interest is Albion Place in Manchester. The short-term let apartments, which complete in January 2022, are already 75% sold, after strong demand from investors keen to capitalise on their superb location and promising yields.
The apartments are nestled between Manchester city centre, Media City and Salford University, just minutes from the £2.5bn Salford Crescent Masterplan. This makes them ideal for those staying in the city on business, as well as those visiting for pleasure. Investors therefore have plenty of scope to be flexible when it comes to maximising their income. Given the varying factors at play right now that are impacting how we travel and use accommodation – not just the pandemic, but Brexit and climate change too – this flexibility is likely to be crucial over the next couple of years.
Short-term lets are offered for periods of up to six months. According to Direct Line for Business:
“You can achieve a much better pro-rata rental amount than with a long-term let. Even with the greater ongoing management costs, if you have good occupancy levels, you could achieve rents and yields that are 30% higher – and, in some cases, more.”
Direct Line also points out another advantage of short-term holiday and corporate lets compared to longer-term rentals – if you end up with a bad tenant, they won’t be around for long and there won’t be the hassle of an eviction process.
“Serviced accommodation such as the short-term lets at Albion Place are in huge demand. They deliver a number of advantages to investors while there are also fewer of them available than long-term lets – it’s a combination that means investors need to move fast when opportunities such as Albion Place arise.”
Dale Anderson, Managing Director, Fabrik Invest
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