Research from property developer, Stripe Property Group, has shown that having rebounded from a pandemic dip of 24% in 2021, the market size of the UK holiday accommodation sector grew by 21% last year, with the sector expected to benefit from further growth in 2023.
Barrows and Forrester analysed the market size of the UK holiday accommodation market based on revenue and how this sector has grown over the last decade.
The research shows that today, the estimated market size of the sector is £2.54bn, having grown by an impressive 38% over the last decade, from £1.8bn in 2013.
However, this growth may have been even more impressive had the pandemic not brought the tourism and travel sector to its knees, as in 2021, the market size of the UK holiday accommodation sector reduced by 24% in a single year.
This was just the second annual reduction seen over the last decade and saw total market size fall from its peak of £2.76bn in 2020 to less than £2.1bn in 2021.
The good news is that a return to normality has helped boost the sector, with an immediate 21% bounce back in 2022 pushing market size back to £2.5bn.
It’s estimated that in 2023, the sector will grow by a further 4%, however, the expected £2.6bn will remain some 4% below the pre-pandemic peak.
Managing Director of Stripe Property Group, James Forrester, commented: “While staycations boomed in popularity during the pandemic, and continue to do so, the UK holiday accommodation sector was hit hard by the restrictions imposed on travel, not to mention every other area of life.
“However, the sector has shown promising signs of a return to form and this growth is expected to continue this year.
“It should certainly be a consideration for those looking to invest within the property market who might not wish to follow the traditional path of a residential development.
“Whether it’s holiday accommodation, purpose built student accommodation, or a commercial venture, there are a vast array of opportunities within the market for savvy investors who wish to diversify their portfolio.”