Holiday lets remain one of the most resilient and profitable property investments in the UK. Whether you’re a seasoned landlord or a first-time investor, choosing the right location is the single most important decision you’ll make. The right spot can mean high occupancy rates, year-round bookings, and happy guests who keep coming back.
In this guide, we’ll explore what makes a location work for a holiday let, highlight some of the best places to buy in 2025, and explain how to protect your investment from day one.
Why Location Matters for Holiday Let Success
How location affects occupancy rates and income
In holiday letting, location is everything. Guests choose where they want to go before they decide where they’ll stay. Properties in popular destinations with plenty to see and do naturally attract more bookings – and often command higher nightly rates.
With Cornwall’s beaches, the Lake District’s walking trails, or Edinburgh’s historic Old Town, visitors flock there in groups. In the right place, even a modest property can perform well. In the wrong place, the most stylish interiors won’t fill your calendar.
Balancing high demand with property costs
While prime locations offer high occupancy potential, they also come with higher purchase prices. The key is finding a balance. A place that’s in demand, but where the cost of buying and running the property still allows for a healthy return. This might mean looking at emerging hotspots rather than the most famous tourist towns.
Key Factors to Consider When Choosing a Location
Local tourism demand and attractions
Look for areas that draw consistent visitor numbers. Popular spots like the Cotswolds, Cornwall, the Lake District, and the Scottish Highlands are safe bets, offering strong year-round appeal. Guests are drawn to places with beautiful scenery, historic landmarks, cultural events, and quality local amenities.
Year-round appeal vs seasonal hotspots
Coastal towns often thrive in the summer, while cities and certain countryside locations can pull in guests through all seasons. Longer booking periods – fuelled by trends like remote working and mid-week breaks – help to smooth out seasonal dips.
Accessibility and transport links
Guests want to reach your property easily. Locations near airports, train stations, and good road links attract more weekend breaks and short stays. If a spot is too remote, it may limit your audience.
Local rules, taxes, and planning restrictions
Some councils are tightening rules on short-term letting, introducing registration schemes or limiting the number of days you can rent out a property. Always check planning requirements and local bylaws before you commit.
Top UK Locations for Holiday Let Investment in 2025
Coastal escapes – Cornwall, Devon & beyond
Cornwall remains a firm favourite for British holidaymakers and overseas visitors. St Ives, Padstow, and Falmouth are all in demand, offering a mix of beaches, culture, and food experiences. South Devon has also performed strongly, with summer occupancy rates hitting around 78% in 2024.
Other coastal gems include Northumberland’s unspoilt beaches, Pembrokeshire’s coastal paths, and the Isle of Wight’s family-friendly appeal.
Countryside retreats – Lake District, Cotswolds, Yorkshire Dales
The Lake District’s combination of world-class scenery and year-round attractions makes it one of the most dependable locations for holiday letting. The Cotswolds offer chocolate-box villages, market towns, and easy access from London, while the Yorkshire Dales attracts walkers and cyclists looking for an active break.
City breaks – Edinburgh, Bath, York
Cities remain strong performers, particularly those with history and cultural events. Edinburgh benefits from festivals, stunning architecture, and a steady flow of international visitors. Bath’s Roman heritage and York’s medieval streets also draw guests throughout the year.
Emerging hotspots with growth potential
If you’re wondering where to invest in a holiday let in the UK beyond the big names, consider up-and-coming areas like parts of the Scottish Borders, Norfolk’s coastal villages, and market towns in Shropshire. These areas often have lower purchase costs but growing visitor interest.
Maximising Returns from Your Holiday Let
Targeting the right guest market
Define your target audience (families, couples, dog owners, walkers) and tailor your property, amenities, and marketing to them. A pet-friendly cottage near beaches will appeal to a very different market than a sleek city-centre apartment.
Pricing strategies and seasonal rates
Flexible pricing helps you maximise income. Higher rates in peak season and competitive offers in quieter months can keep occupancy levels steady. Research local competition to ensure your rates are attractive but profitable.
Marketing your property effectively
List on major booking platforms like Airbnb, Vrbo, and Booking.com for visibility, but consider building your own website to secure direct bookings and avoid commission fees. Professional photography and detailed, engaging descriptions are essential to attract clicks and convert them into bookings.
Protecting Your Holiday Investment
Why specialist holiday let insurance is essential
Standard home insurance won’t cover the risks of letting to paying guests. You need holiday let buildings insurance tailored to your property type and usage.
A good policy will protect you against:
- Public liability claims if a guest is injured.
- Accidental or malicious damage caused by guests.
- Loss of rental income following an insured event.
- Employers’ liability if you hire staff.
Common risks and how to mitigate them
Guest-related damage, cancellations, and weather events are some of the biggest risks. Quality insurance, clear guest rules, and a reliable cleaning/maintenance routine will help you minimise problems and protect your income.
Key Takeaways
- Choose a location with proven tourist appeal and strong occupancy potential.
- Balance demand with affordability to keep returns healthy.
- Consider year-round potential, not just peak season performance.
- Make sure the area is easy to reach and check any local letting restrictions.
- Target your marketing to the guests most likely to book your property.
- Protect your investment with specialist holiday let buildings insurance.
Get in Touch
Investing in the right location is the first step towards holiday let success. Whether you choose a coastal escape, countryside retreat, or city-centre apartment, the right cover will protect your property, your income, and your assets.
At Policy Powerhouse, we make it simple to arrange holiday let buildings insurance that’s tailored to you – whether your property is standard or a little out of the ordinary. Speak to our friendly experts today and get a fast, competitive quote, so you can focus on welcoming your first guests with confidence.
FAQs
Is a holiday let a good investment in the UK?
Yes, with the right location and management, holiday lets can deliver strong returns and long-term capital growth. Demand in many UK regions remains high.
How much profit can I make from a holiday let?
It depends on location, property type, occupancy rates, and running costs. Well-managed properties in high-demand areas often outperform traditional buy-to-lets.
Which UK regions have the highest demand for holiday lets?
Coastal areas like Cornwall and Devon, rural spots like the Cotswolds and Lake District, and city destinations like Edinburgh and York consistently perform well.
