"What we're seeing is a shift towards more considered decision-making, with buyers increasingly focused on long-term performance rather than short-term gain"
- Laura Dubois - Together Travel
The UK holiday home market is adjusting to a new reality. A 200% council tax charge, now applied by around 70% of local authorities, combined with the removal of key tax reliefs, has begun to reshape how second properties are bought, owned, and operated.
Holiday home numbers in England peaked at 346,956 in 2024 before easing to around 336,011 in 2025, a 3% decline and the first sustained fall in more than a decade.
For property investors, the shift raises a straightforward question: does the UK holiday home market still stack up?
Analysis from holiday home management specialist Together Travel suggests the underlying case remains intact, but the model of ownership is changing. Buyers focused on short-term gains are giving way to those taking a longer view, prioritising consistent income, year-round demand, and professional management over opportunistic returns.
Regional demand data from VisitBritain supports that picture, with four UK regions recording year-on-year growth in domestic stays in March 2026. Scotland saw the strongest uplift, with stays rising from 3% to 15%, a 400% increase, driven by growing appetite for rural and nature-led breaks.
London stays rose 31% between 2025 and 2026, reflecting the capital's resilience as a short-stay destination underpinned by a strong events calendar and consistent international visitor demand.
In the South West, including Cornwall and Devon, performance reached 21% in 2026, a rise of nearly 17%, reinforcing the region's position as one of the UK's most established domestic tourism markets.
The East of England, covering areas such as Norfolk, saw stays increase from 19% to 22%, driven by accessibility, value, and demand for coastal and countryside breaks within reach of major cities.
ONS data highlights where holiday homes remain most concentrated within local housing stock. Across the Isles of Scilly, they account for 31% of total stock, the highest proportion in the UK, reflecting the island's premium tourism appeal and limited housing base.
In London, the City of London (24%), Kensington and Chelsea (9%), and Westminster (8%) all rank among the top holiday home locations, reflecting the capital's dual role as a global tourism destination and international investment market.
In Norfolk, North Norfolk (14%) and Great Yarmouth (7%) underline the region's coastal tourism economy, while in the South West, Cornwall (9%), South Hams (12%), North Devon (7%), and Torridge (7%) confirm the area's status as the UK's most established holiday home market by volume.
"The market is evolving, but underlying demand remains strong, particularly in coastal and rural areas," said Laura Dubois, holiday home specialist at Together Travel. "What we're seeing is a shift towards more considered decision-making, with buyers increasingly focused on long-term performance rather than short-term gain."
"In regions like Cornwall and across the South West, holiday homes continue to play an important and established role in supporting the local tourism economy, helping to sustain year-round visitor activity, local employment and investment in local services," she added. "While conditions are changing, well-located properties with strong management remain well-positioned to deliver consistent performance over time."
"Importantly, that performance isn't just about rental income. Properties that are carefully chosen and professionally managed in proven destinations have typically shown the ability to appreciate in underlying value over the long term. That balance of income and capital growth is increasingly what buyers are looking for," Dubois continued.
For investors considering entering the market, Dubois points to five factors that tend to separate strong-performing assets from weaker ones.
Seasonality is the first. The strongest properties attract visitors beyond the summer peak, generating income across spring, autumn, and winter.
Entry price matters equally: overpaying at acquisition can quickly erode returns, while well-priced stock is better placed to absorb shifts in costs and demand.
Location resilience is a third consideration, with established tourism destinations, where visitors return year after year, tending to outperform newer or untested markets over time.
Management quality is often underestimated. How a property is run can be as consequential as where it sits, with consistent, professional management separating good assets from high-performing ones.
Finally, Dubois points to patience. "Holiday homes tend to perform best over time. Those who take a patient, long-term view are more likely to benefit from sustained demand and stronger overall returns," she noted.
