Are you still planning your holidays for 2020? Or maybe you plan to tick off some destinations on your bucket list this year.
Many of our hosts use the income from short letting their home to pay for their holidays and getaways. In fact, it’s frequent travellers, whether for work or leisure, who benefit the most as they offer their home to London visitors while they’re away throughout the year. We reviewed the demand for short let homes and the average rates per night across London between now and the end of August. The data supports what we already know about the London short let market and the growing popularity of London as a holiday destination.
Summer holidays drive up the average nightly rate
The most popular periods for homestays in London also happen to be the dates that you’re most likely to be escaping the city. For example, school half-term, summer holidays, Easter, the May bank holidays and during events that bring crowds to the capital such as the FA Cup Final and the tennis at Wimbledon. Demand then remains high throughout June, July and August. In the chart below, we’ve plotted the average nightly rate for entire homes in the top ten boroughs in London over the next six months.
There’s a steady rise in average rates across all ten boroughs over the Spring-Summer period with some areas such as Westminster, City of London and Islington having a slightly more pronounced peak than others.
As you can see in the chart, Westminster is the most popular borough for short let properties in London over the next six months with the average nightly rate ranging from £188 in February to £245 in August. July is the most popular month with the nightly rate peaking at £256 on average. Westminster also has the highest concentration of properties for rent on Airbnb with over 8,000 homes listed currently.
Next up is Kensington & Chelsea, where the nightly rate increases from £183 in February to £230 in August. There are over 5,000 homes listed on Airbnb in the borough. The third most popular area is the City of London where the rate per night averages £159 in February rising to £211 in August. There are less than 500 homes listed on Airbnb in the City Of London, reflecting the small size of the Square Mile and the relatively low volume of residential properties contained within it.
The borough of Camden is in fourth place in terms of average nightly rate with rates from £150 in February up to £189 in July and August. There are almost 4,000 entire homes listed on Airbnb in Camden. Lambeth takes the fifth spot in our top ten list with February nightly rates averaging £138 and hitting their peak in July at £187. With Wimbledon not too far away, it’s not surprising that nightly rates are at their height in the first two weeks of July when the tennis tournament is on.
Hammersmith & Fulham, Southwark, Islington and Tower Hamlets fall into a similar price bucket from the region of £130-£140 in February to £160-170 in August. Rates in Islington peak at £180 per night on average in July. These four boroughs are well-served by Airbnb rentals and represent 25% of all the entire homes available to short let in London.
Number 10 on the list is Hackney where average nightly rates range from £129 in February to £153 in August. There are over 2,000 properties listed on Airbnb in the borough of Hackney, and the areas of Hoxton and Shoreditch are particularly popular choices with visitors.
What does this mean for London Airbnb hosts
It’s worth noting that the average nightly rate can vary considerably day-by-day and week-by-week based on customer demand. For example, it’s typical for rates to be higher on Friday and Saturday nights when visitors come to London for the weekend. However, during the peak summer months, this pattern can alter as guests typically opt for longer stays over the holiday season. Major events and celebrations will also drive up demand. For example, in February, both Valentine’s Day and half-term create increased demand. In July, there’s increased demand in the first half of the month when Wimbledon and various open-air festivals occur.
Without the appropriate planning permission from the local authority, you are restricted to short letting your London property for a maximum of 90 days per calendar year. Whether you plan to be away from home for three weeks or three months, summer is the most lucrative period to short let your London property. When you’re short letting your home your aim is to achieve the maximum occupancy rate – the ratio of booked nights as a percentage of the total available nights – at the best average nightly rate.
Getting ready for the summer months
Summer is the period when occupancy and average nightly rates are at their highest levels. In the summer, visitors to London stay for longer and are prepared to pay more per night for the comfort of a charming home in a convenient location. And for guests, the rates for a homestay are still favourable when compared to London hotels for the same period.
What better way to fund a family holiday or that trip of a lifetime than by having visitors to London enjoy your home while you’re off on your travels. With the average nightly rate of £193 across the whole of London in July 2020, you could earn over £2,700 gross for a two-week booking. This could pay for your next holiday or at least a sizeable chunk of it. A well-timed break can pay for itself or even leave you with money in your pocket for your next trip.
Would you like to know how much on average your London property could earn you per week* from short letting? Click on the button below and complete our quick rent estimation tool.