How Many Bookings Can you Expect from a Holiday Letting Agency?

Posted by Linda Maclaughlan on 23 February 2016

Are you curious about how many bookings you can expect to get from a holiday letting agency?

As most agencies will tell you – and as I often have to explain to most of my clients – this is a tricky one. There are never any guarantees, but there are a few factors to take into consideration when working out roughly how many bookings your holiday let might receive.

Below, I’ve put together my years of expertise in the holiday letting industry to help you figure out how many bookings you might be able to expect, and the factors that can affect bookings.

But first, let’s take a look at the average number of bookings for Scottish holiday lets.

Average holiday let booking percentages

The number of bookings your holiday let receives will depend on a number of factors, such as:

  • Your holiday let’s location
  • The size of property you own
  • How competitive your pricing is
  • Where you choose to advertise

For instance, a smaller agency will not be able to compete with the same high volumes of traffic a larger agency may receive – but then, with larger agencies, it can easy to feel like your holiday let is lost in the crowd.

A recent survey from Visit Scotland suggests an average occupancy of around 46% for self-catering Scottish holiday lets, but for an area such as the Scottish Borders, you can expect an average occupancy of 54%.

As a general rule, we typically say you can expect at least 20 weeks of occupancy over the year, although this could rise to 40 weeks or beyond – and one of our clients managed to achieve this in his property’s first year!

What really matters

Regardless of the amount of traffic your holiday let receives, the fact of the matter is that clients won’t book it unless the property is right, the location is right, and – most importantly – the price is right.

There is no shortage of self-catering properties in the Scottish Borders – just click on any large listing site, and filter by area. When I first started doing this, the number of properties showing up per town i.e. Melrose would have possibly be in the single figures, now holidaylettings.co.uk alone lists 31!

This doesn’t include people going it alone or using different agencies – of which there are many. Because of this, I cant stress enough how price-sensitive the market is – especially when you get to the couples’ market.

Despite this, you’re probably still going to want a good idea of the return you can expect from your holiday let, which brings me onto the next section…

How to estimate your return

As I’m about to tell you below, there are no guarantees on the return or number of bookings you can expect from your holiday let – however there is a way you can work out a rough estimate.

I do it by basing my estimate on a very conservative 20 weeks’ occupancy, before multiplying the weekly booking amount. So, a real-life example would be:

Me! I own a two-bedroom property in the Edinburgh area which is in its fifth year now – and as with most holiday lets, my income has increased each year.

Year 1: My holiday let was occupied for 29 weeks out of the year, giving me a 55% occupancy rate and an income of £11,500.

Year 2: My holiday let was occupied for 30 weeks out of the year, increasing the occupancy rate to 57% and leaving me an income of £13,800.

Year 3: The property was occupied for an all-time high of 36 weeks out of the year, which gave me an occupancy rate of 70% and an income of £14,900.

Year 4: My holiday let was occupied for 34 weeks, giving me a 60% occupancy rate and an income of £15,000.

So, looking at the average occupancy rate of 61% for Edinburgh and East Lothian (via Visit Scotland), it’s just about spot on!

TIP: Don’t forget to calculate your running costs when calculating your return! Read more in my blog post ‘What Are the Weekly Running Costs of a Holiday Let?’.

No guarantees

I recently saw a holiday letting website ad saying you can “earn £54,000 a year”. I know for a fact that although it’s possible, it’s not really plausible, as for a typical holiday cottage it would mean bringing in £1,000 per week – every week!

What I’m trying to say here is that 100% occupancy rates are extremely rare, and right enough, the small print said that’s what the top 5% of properties reportedly achieve.

It’s very easy to make the figures sound amazing, but I believe honesty is the best policy, and misleading customers – intentionally or unintentionally – is a big no-no.

It’s true that there are no guarantees in this game, so if an agency says they can promise you 60%, 70%, 80%+ occupancy from your holiday let, I’d recommend looking elsewhere, because in reality, there’s no way they can know for certain how many bookings you’re going to get.

When I first started out with my holiday let – and even now – I get calls from people promising me x amount of weeks if I advertise with them. And when I ask how that was possible, they merely reply; “It’s just how it works.” — Really??

My advice is to take these promises with a pinch of salt.

And finally, don’t forget that running a holiday let is just like any other business – and to be successful you really need to put in the work so your guests can enjoy the holiday they deserve!

Conclusion

If you’re left scratching your head when it comes to the number of bookings you’ll get from your holiday let, you’re not the only one – but it’s wise to remember there are never any guarantees. Your potential number of bookings and return can depend on a number of factors, such as:

  • Your holiday let’s location
  • The size of property you own
  • How competitive your pricing is
  • Where you choose to advertise

Above, I’ve given you a good idea of how to calculate your average return based on a very conservative 20 weeks’ occupancy out of the year. But remember, your holiday let’s bookings can increase over the years, so if you’re just getting started, give it time to build up!

And remember, once guests are there, your objective should be to get them to leave a good review and go away happy – perhaps even thinking about booking their next visit. Returning guests speak volumes!

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2 comments on “How Many Bookings Can you Expect from a Holiday Letting Agency?”

Written by Deleted User

 

Thank you that information was very helpful indeed, the returns even at the lower end are better than plonking your money in the bank even at a return of 5% and would I be right in saying based on a static caravan with running costs of around £5k per year this is still a viable option?

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Written by Lowlandlettings

 

Hi Steve Yes it very difficult to get any great level of interest leaving your money in the bank at the moment. However having the money in the bank is a safe option so it really depends on your attitude to risk I guess. What we always suggest is that you do thorough research into the area and the running costs especially taking into account maintenance costs - as there will definitely be some! I wish you the best of luck and do let us know how you get on - we'd love to hear about it!

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