UK short-term rentals summer 2021 outlook – rates & occupancy up on 2019

UK short-term rentals have been on a rollercoaster of demand over the past weeks, as restrictions both nationally and internationally begin to ease. As the dust settles, what exactly is summer 2021 outlook?

We have selected 3 differing key markets to analyse, looking at pricing and occupancy for the summer and demand levels right now across the UK.

Summer pricing of UK short-term rentals

First let’s explore pricing: we can see in the graph below that 2021 July rates have risen above those of 2019. What’s more is that looking at current advertised ADR, that booked rate will rise further.

London may have increased but our non-urban markets, particularly our rural national park destination of Keswick, whose booked ADR is up 42% year on year. Meanwhile, Newquay, a south coastal town is enjoying a 31% increase.

The demand for non-urban inventory is plain to see, as is the confidence in this demand, with property managers advertising with huge mark-ups on 2019 levels.

It is true that advertised rates at this more peak booking time might be expected to be a bit more premium. You might also argue that year on year trends expect this inflation. However, this is not an ordinary, predictable year. Given the collapse in realised demand through the pandemic, this strategic pricing confidence while hotel rates have declined is notable. What’s more, the July 2018-July 2019 rate changes for Newquay and Keswick were -4% and -3% respectively.

Summer occupancy of UK short-term rentals

So, we’ve observed a sense of security and confidence in UK short-term rental property manager pricing strategy. Is there a basis for this or is it simply optimistic of revenue recovery?

Looking at occupancy on the books, the chart illustrates the difference between July occupancy levels in mid-April for 2019, and 2021.

The most notable thing is the disparity between London and the non-urban markets. Both Newquay and Keswick had around a third of listing nights booked for July by mid April 2019, yet in 2021, had close to 70% occupancy on the books in mid April. That means more than double the occupancy at that point.

London meanwhile is down on 2019 occupancy on the books. However, the demand is again plain to see, and this appetite goes some way to explaining the faith property managers have in pricing high. Both are positive signs for rapid recovery.

What of current demand?

Interestingly, when we look at the UK regionally, there are big discrepancies in booking demand. Following an initial flood of bookings in the wake of lifted national restrictions, the easing of international restrictions has slowed local reservations. With international visiting rules still strict, foreign travel is not yet picking up that slack.

As a rule of thumb, national park rich, rural-dominated regions are enjoying much more demand than in previous years. Beach areas such as Cornwall, who were the hot ticket previously and booked up a lot of early summer occupancy, appear to have cooled off slightly as would-be guests look further afield for sunnier climes.

These demand levels fluctuate regionally constantly, and it is a good idea to stay up to date on the data in your area. (See our free tracker for example).

Ultimately, the pricing, occupancy and reservations seen, both in the UK and worldwide are encouraging for the tourism industry. They nod towards quick recovery of demand and the appetite of all of us to be in another home again. Could this demand even be indicative of a longer-term peak of interest?

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