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The 5 best UK cities to be an Airbnb host

Analysis reveals that Bradford offers the best combination of low house prices and high Airbnb revenue. According to research by international payment experts RationalFX, it would take nine years of Airbnb income to pay off a property purchase in Bradford compared to 42 years in Luton. The study of just 27 major British cities analysed data from AirDNA and ONS to find which UK city offers the best combination of low property prices and high revenue from renting out via Airbnb. It revealed that it would take just nine years to pay off the median house price in Bradford (£135,000) based on the average monthly revenue of £1,229 an Airbnb in the city generates. As a result the Yorkshire city tops the list, offering the best combination of low property prices and high revenue. Swansea came in second, with an average of £1,100 in Airbnb revenue taking 10 years to pay off the city’s median property price, which is £143,500. In addition a high occupancy rate of 62% over the past 12 months makes the popular Welsh beach city highly cost effective for hosts. During the pandemic there has been a sharp rise in the interest in staycations instead of overseas holidays. Research in 2020 found that 42.7% of people would rather enjoy a staycation compared to 24.7% of people voting to go abroad. In addition property investors could also to take advantage of the government’s stamp duty exemption for the first £250,000 of a property, which is available until September. Out of the 27 cities in the analysis, 18 have a median house price below £250,000. Stoke-On-Trent was the third most profitable city to be an Airbnb host. With a monthly revenue rate of £1,030, it would take 12 years to pay off the city’s median property price of £151,000. Bradford has the highest occupancy rate per year (83%), followed by Brighton with 71%, and Bournemouth and Plymouth both on 70%. Commenting on the study, a spokesperson for RationalFX said: “The demand for staycations has risen dramatically in the last year amid the pandemic, showing that the private holiday rental business is an area of interest for investment. With the easing of restrictions in the UK, it will be interesting to see how UK Airbnb bookings compete with the option of foreign holidays.” Top five best cities to be an Airbnb host
Rank City Monthly revenue (AirDNA) Occupancy rate per year (June 2021) (AirDNA) Median house price Dec 2020 (ONS) Active rentals (AirDNA) Years of Airbnb revenue required to cover property price
1 Bradford £1,229 83% £135,000 518 9
2 Swansea £1,100 62% £143,500 1,313 11
3 Stoke £1,030 48% £151,000 676 12
4 Plymouth £1,200 70.0% £197,000 611 14
5 Belfast £764 57% £128,300 875 14
The study found that  Brighton ranks top for monthly revenue, with properties in the city generating an average £1,649 each month. However it also has the third highest median house price on the list at £367,500, meaning it would take more than 18 years to cover the cost of the property. As a result the popular staycation destination ranks 14th overall on the list. Holiday makers can expect to pay on average £142 per night for a stay in a London Airbnb, the country’s priciest city, compared to £63 a night in Sunderland, the lowest rate in the UK. However the capital ranks as one of the least profitable areas to be an Airbnb host. London has 37,000 active rentals, making it the city with the most Airbnbs in the UK. This is more than seven times higher than Edinburgh, the city with the second highest active rentals of 5,350. Despite the high number of rentals, London ranks 26th out of the 27 cities for profitability. It has a significantly higher median house price than the rest of the UK, coming in at £475,000, and only ranks 11th for Airbnb revenue, with the average property generating £1,011. Leicester is the 10th largest city in the UK, but it has just 455 active rentals – the third fewest on the list, along with 33% occupancy rate per year, the lowest of all cities measured. With the lowest monthly income of £600 and a median property price of £218,000, it would take an average Airbnb host in the city 30 years to pay off a property. The East Midlands city ranks third from last on the list. Luton ranks as the least profitable city to buy an Airbnb in the UK. It would take a host 42 years to earn the money covering the cost of their property. The Airbnbs in the city have an occupancy rate of 48% and the median house price is £375,000 – behind only London in the study. Top five worst cities to be an Airbnb host
Rank City Monthly revenue (AirDNA) Occupancy rate per year (Jun 2021) (AirDNA) Median house price Dec 2020 (ONS) Active rentals (AirDNA) Years of Airbnb revenue required to cover property price
23 Southampton £997 63% £300,000 711 25
24 Coventry £720 50% £218,600 691 25
25 Leicester £600 33% £218,000 455 30
26 London £1,011 48% £475,000 37,550 39
27 Luton £738 48% £375,000 310 42
Of course, this doesn’t consider many other factors such as the potential property value increase, the cost of labour for repairs or for servicing/changeover of a property, but it does nevertheless provide some interesting insights into what cities in the UK might offer the best potential for an airbnb investor. Bear in mind also that the study looked at just 27 cities when in fact there are more like 69 cities across the UK (depending on how you define a city). There may also be many towns and villages across Britain that offer competitive returns, of course.

Paul Johnson

Paul Johnson is Editor of A Luxury Travel Blog and has worked in the travel industry for more than 30 years. He is Winner of the Innovations in Travel ‘Best Travel Influencer’ Award from WIRED magazine. In addition to other awards, the blog has also been voted “one of the world’s best travel blogs” and “best for luxury” by The Daily Telegraph.

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  1. Well, can’t say that I’ve spent too much time about the Airbnb league table but those 5 cities topping it are quite a surprise.

    1. Yes, Roxii – not exactly tourism hotspots, particularly in the case of Bradford and Stoke-on-Trent. I think what you have to bear in mind that this is looking at the situation largely from an investment perspective and not necessarily a tourism one. It’s clear that the house price is a major factor influencing the final hierarcy with all of the top 5 having a media house price value below £200k, and all of the bottom 5 having a media price value above £200k. Where house prices are low, there’s invariably a good reason for that.

  2. Ignore the London property market at your peril. There are signs that London property prices and rental values are falling now that so many people can work from home.

    London may be about to ease its way up those property league tables.

    1. I’m not sure there are signs that London prices are falling just yet – just that they’re more stable than other areas experiencing a COVID ‘bubble’. I think we can expect prices to rise more in line with the national average once offices start to re-open. Sure, there will be some who never go back to an office and I guess that could mean London will move up the league table, but I think it could be some time (if ever) before we see it make the ‘top 5’…

    2. It’s a figure based on property prices and rental values skewed by Saltaire, Haworth, Skipton, Grassington and Kettlewell. These areas have BD postcodes, but are not in Bradford. Property prices in these more desirable areas are significantly higher than central Bradford. Do not invest in anything within a 3 mile radius of this very run down and depressing city.

  3. Might the work from home trend boost Airbnb? There are times when you have to physically go into work. Some of my friends are talking about commuting into work, going for drinks with colleagues in the evening, staying somewhere cheap over night and then making an early start on the second day in the office before travelling back home in the afternoon.

    1. I guess that probably happens sometimes. There are so many different types of airbnb (eg. single rooms in someone’s flat on entire mansions) and so many geographical differences (eg. London versus more rural places) that it’s maybe hard to imagine this being a trend across all airbnb properties.

      I know where I live there has been a growing problem with residents being asked to vacate the properties they have lived in and rented for years so that the owner can run the property as an airbnb instead, since the returns can be significantly greater in some places. This of course has a series of knock-on problems for communities (eg. local businesses finding affordable local employees, etc.)

  4. And Airbnb can change the nature of a place too. A very disgruntled lady in Budapest told me that she was moving districts as there were far too many Airbnb’s in her road pulling in stag dos. She wanted some peace, quiet and sleep.

    I didn’t dare tell her that my son had his stag weekend in Budapest.

    1. Yes, Sheila – as I said in my reply to Carolyn, the nature of a place can very much change, for a myriad of reasons. It’s a shame, really.

  5. This could all become a lot more complicated. For example, let’s start factoring in the time value of money. Rising inflation, reduces the value of the sum to be repaid if borrowed, whilst possibly increasing present. Then, of course there is the possibility of changing rates of taxation on earnings.

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