The total spend by holiday rental clients in the UK is estimated at more than £4.35 billion a year and is responsible for creating over 95,000 jobs nationwide, according to new research by the London School of Economics for provider HomeAway.
Expenditure by tourists staying in self-catering accommodation grew faster than spending by holidaymakers booking any other accommodation category.
The study also reveals that the holiday rental industry contributes an estimated £100 million in tax revenue to the government, while the gross income of all holiday rental owners in the UK is as much as £950 million.
Net additional expenditure by holiday rental clients is estimated at up to £2.2 billion a year – far higher than the net additional expenditure generated by travellers staying in any other type of accommodation.
The report predicts that 36% of holiday rental owners are likely to buy an additional rental home in the next five years and there is “significant potential” to grow inbound tourism from South America, Asia, Africa and the Middle East.
The study includes a survey of more than 1,600 UK holiday homeowner respondents.
LSE research fellow Kath Scanlon said: “This report suggests that the holiday rental industry contributes to the UK economy by increasing tourism income and creating jobs.
“These effects are felt in regions across the country. Holiday rental visitors stay longer at their destinations and therefore spend more – in fact, many visit rural or seaside areas specifically to stay in attractive holiday rental properties. This has helped areas like Cornwall where tourism has pumped new pounds into previously struggling locales.”
She added: “Most holiday rental owners support other local businesses. Our survey found that over 90% of rental hosts across the country highlight local community offerings when asked for recommendations by their guests. Support is also in the form of employment, with over three quarters of owners employing staff to assist with property maintenance.
“Nationally, owners spend an average of about £1,600 per year per property on hiring employees. In Cornwall and North Yorkshire – two locations with underemployment issues – the figures are even higher. In these areas owners spend on average £2,500 and £3,000 respectively per property.”
HomeAway UK regional director Erica Chang said: “This report is the first step in showing the significant value that the holiday rental market brings to the economy as a whole, as well as to individual communities which depend on tourism.
“While HomeAway has known how important holiday rentals are to the tourism industry, we are excited to be able to demonstrate this through figures that contribute to employment and local commerce.
“There is more research that is needed, so now we will begin to look more closely at the traveller experience, and the impact and opportunities this has for local commerce.”