Global traveller numbers hit over 1 billion on a yearly basis meaning a 6th of the worlds population are potentially looking for hotel accommodation. With this in mind investing in hotels has been a wise move by savvy investors for a long time. It is a known well fact that if you try to book a hotel room within days of travelling you will most likely fall into troubles as hotels are often fully booked, especially in parts of the UK.
In addition to high demand, hotels are not cheap to book into and offer far higher rates than any other kind of accommodation, often hotel rooms can cost hundreds or even thousands of pounds a week. These high rates are one of the main reasons why investors benefit from such high yield returns. Unlike most other investments the price of a unit and the yield supplied scale up much better, the reason for this is often due to the fact that higher end hotels cater to much higher standards therefore can easily charge much more for rooms, but cheaper hotels can squeeze in many rooms and keep them fully occupied, this easily keeps rental yields close to double figures across the board.
Hotel location is obviously one of the key factors for travellers, holiday makers and business persons. We have found that in the UK areas which consistently demand high occupancy rates all year round are coastal areas of the UK, combined with the fact that prices in such locations are suitable for the low and mid range investor. As for Urban locations such as London we find that the prices are often to steep for most of our clients therefore we stick to the coastal holiday resorts.
With major chains such as Premier-inn and Travel-lodge over booked in these areas it falls on independent hotels to fill the large demand. Some towns such as Newquay in Cornwall benefit from many holiday makers in the summer and then again from the global surf community in the winter months as the surf is some of the best in world attracting the World Surf Championships. With such a reliable stream of customers hotel investments are among the most secure.