A holiday cottage income calculator appraises a property that is let by the night rather than by the month, and it has to carry what a buy-to-let calculator does not: a nightly rate that changes by season, an occupancy that changes with it, a changeover cost for every stay, a platform's commission on every booking, and the utilities, the furnishing and the council tax or business rates the owner pays rather than a tenant. It also has to carry the conditions HMRC sets for a furnished holiday let, which are counted in days available and days let. This page sets out what the appraisal takes in, where the nightly rate and the occupancy come from, and how the answer is read beside a buy-to-let of the same house.
The inputs a holiday let adds
The nightly rate in high, mid and low season, taken from the comparable cottages on the booking platforms rather than from hope; the occupancy in each, which the same platforms show in their calendars; the changeover cost per stay, cleaning and laundry, multiplied by the number of stays; the platform's commission on the booking value; the utilities, broadband, television and furnishing the owner carries; and the council tax or business rates, which depend on how many days the property is available and let. The rent comparables sheet on this site works a monthly let per square foot from three lets; for a holiday let the comps are the cottages and the figure is per night.
The outputs, and the two figures that decide it
The annual booking value from the rates and the occupancy by season; the costs from the changeovers, the commission and the running costs; the cash left after them and after finance; and the return on the cash in. The two figures that decide a holiday let are the occupancy, which is a guess until the first year proves it, and the changeover cost, which is paid whether the stay was three nights or seven. An appraisal that uses the platform's headline occupancy and forgets the changeovers is the usual way a holiday let disappoints.
The conditions, and why they are counted in days
HMRC treats a furnished holiday let differently from a residential let only when it meets conditions counted in days: the days it is available to let, the days it is actually let, and the days any single stay may run. The helpsheet cited below states them, and the appraisal has to carry the occupancy needed to meet them alongside the occupancy needed to make money, because a cottage that misses the availability condition is a residential let for tax whatever its calendar looks like. Which treatment applies is the accountant's answer; the appraisal's job is to show the days.
Questions people ask about holiday cottage income calculator
What occupancy should a holiday cottage income calculator assume?
The occupancy the comparable cottages actually show on their calendars, by season, in the first year, and the property's own after that. A national average is a number for a national cottage.
Is a holiday let more profitable than a buy-to-let?
On the gross booking value, usually; on the cash left after changeovers, commission, running costs and voids, sometimes; on the management time, rarely. The two appraisals side by side, on the same house, are the honest answer.
What are the furnished holiday let conditions?
Conditions counted in days available, days let and the length of a stay, stated in HMRC's helpsheet HS253, and whether a property meets them decides how its income is taxed. That is the accountant's ruling; the appraisal shows the days.
Sources
- HMRC, Furnished holiday lettings (HS253): the conditions a holiday let has to meet and the days it must be available and let
- ONS, Private rent and house prices, UK: the monthly Price Index of Private Rents and House Price Index by area
- GOV.UK, Renting out your property: the landlord's legal responsibilities in England