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Holiday let owners are proving more resilient to recent tax and regulatory changes than many feared.
Average gross incomes for holiday let owners rose from £24,700 in 2024 to £25,600 a year later.
This surprise increase suggests people are still opting for staycations in the UK rather than looking overseas.
The UK's favourite staycation destination is The Cotswolds, where a holiday let owner earns an average of £30,600 a year. Within the Cotswolds, the highest earning areas are Stow-on-the-Wold (£41,600), Bourton-on-the-Water (£37,500) and Burford (£34,100).
The next most popular area is Cumbria and the Lake District, where average cottage earnings are £28,400 yearly. The area also has the village with the highest holiday let earnings - Grasmere, which averages £45,900 each year.
A rising star is Matlock, in the Peak District of Derbyshire.
As a gateway to the Peaks, Matlock is popular with walkers and families. Bookings were up 14 per cent in 2025, underpinning an average income of £34,000 a year.
Incomes in many areas are seasonal but consistent throughout the year, ranging from an average of £5,330 in the winter to £7,060 in summer.
The data comes from holiday cottage booking agents Sykes Holiday Cottages, which publishes a detailed analysis of the sector each year.
The report reveals that eight out of ten holiday let owners are confident their businesses will continue to grow, with two out of three forecasting higher occupancy rates in 2026.
Sykes Holiday Cottages Head of Regulation and Policy, Ben Spier, said: "It's impossible to ignore that the nation's holiday let owners have faced some hurdles in recent years, but UK holiday lets still command high occupancy and competitive weekly rates. Through expert guidance and proven income-boosting strategies, owners can unlock the full potential of their holiday let investment.
"New council tax premiums have probably received the most attention in the media, which might be why our research found this to be causing a lot of worry among owners.
"However, these are intended for second homes rather than holiday lets, because the former contribute far less to local tourist economies. So most of our holiday let owners have not been affected by this change as they qualify for business rates.
"By law, a property is eligible to pay business rates if it meets a certain threshold of days let and available."
| Region | Average annual earnings | Highest earning location |
|---|---|---|
| Cotswolds | £30,600 | Stow-on-the-Wold £41,600 |
| Cumbria and Lake District | £28,400 | Grasmere £28,400 |
| Highlands and Islands | £28,000 | Aviemore £34,100 |
| Peak District | £26,900 | Castleton £38,200 |
| Central Scotland | £26,600 | Aberfeldy £34,100 |
| Dorset | £26,600 | Lyme Regis £31,800 |
| Northumberland | £25,800 | Bamburgh £34,400 |
| North Wales | £24,800 | Denbigh £36,000 |
| East Anglia | £24,000 | Southwold £36,700 |
Source: Sykes Holiday Cottages