Is buying a holiday lodge a good investment in 2026?

With UK domestic holidays continuing to surge and demand for premium short-term accommodation at record levels, many investors are asking a sensible question rather than chasing trends, is buying a holiday lodge actually a good investment?

Holiday lodges have grown steadily in popularity over recent years, offering a combination of income potential, lifestyle appeal, and diversification beyond traditional buy-to-let. Positioned in coastal and countryside locations, they sit at the intersection of tourism demand and property investment, appealing to investors who want something more flexible and, in many cases, more hands-off.

As we move into 2026, holiday lodge investments are increasingly being viewed as a credible alternative asset class, particularly for those looking to benefit from tourism-led demand rather than residential rental markets. This article explains how holiday lodge investments work, the benefits and risks involved, and who they are best suited to.

What is a holiday lodge investment?

A holiday lodge is typically a purpose-built, fully furnished property located within a managed holiday park or resort. Unlike residential buy-to-let, holiday lodges are designed exclusively for short-term stays, catering to weekend breaks, seasonal holidays, and longer leisure stays.

Most holiday lodges are sold on long leases or licence agreements rather than freehold residential titles. They are usually operated by an on-site management company or a professional holiday letting operator who handles bookings, guest services, cleaning, and maintenance.

For investors, this structure is key. Rather than managing tenants, repairs, and compliance directly, income is generated through a professionally run system, making holiday lodges particularly attractive to those seeking a more hands-off investment.

Why holiday lodges have grown in popularity

The UK tourism market has changed structurally over the past few years. Rising international travel costs, shifting consumer behaviour, environmental awareness, and a renewed appreciation for UK destinations have all contributed to sustained demand for domestic holidays.

This has not been a short-term spike. Coastal areas, national parks, and countryside locations continue to see strong occupancy, particularly where accommodation supply is limited and quality is high.

Holiday lodges, especially well-located luxury developments, have benefited directly from this trend. For investors, this sustained demand translates into strong booking potential, competitive nightly rates, and repeat visitor behaviour, all critical factors when assessing whether buying a holiday lodge is a good investment.

The key benefits of holiday lodge investment

Strong income potential

One of the main attractions of holiday lodges is income potential. Unlike buy-to-let, where rent is fixed monthly, holiday lodges generate income per night or per week.

During peak seasons, premium lodges in desirable locations can achieve significantly higher rates, boosting overall annual returns. Well-located holiday lodges often benefit from high seasonal occupancy, premium pricing for quality finishes and views, and repeat bookings from returning guests.

While income can fluctuate throughout the year, total annual returns can be attractive when managed properly.

Hands-off management

Most holiday lodge investments are offered with fully managed letting arrangements. This typically includes marketing, bookings, guest check-ins, cleaning, maintenance, and ongoing site management.

For investors, this removes much of the operational burden associated with property ownership. Income is received without day-to-day involvement, making holiday lodges appealing to those who want exposure to property without active management.

Lifestyle and personal use

Unlike traditional investment property, many holiday lodge owners are allowed personal usage for part of the year. This dual-purpose appeal, investment plus lifestyle, is a significant factor for some investors.

Being able to enjoy the property personally while still generating income can add value beyond pure financial returns, particularly for investors who already hold residential buy-to-let assets elsewhere.

Diversification beyond buy-to-let

With increased regulation, compliance, and tax pressure in the buy-to-let sector, many investors are diversifying their portfolios. Holiday lodges sit outside many residential letting restrictions, including long-term tenant legislation and standard AST frameworks.

As a result, they can act as a complementary asset, balancing a wider property portfolio rather than replacing buy-to-let entirely.

Continued demand for UK coastal and countryside locations

Coastal and rural destinations remain some of the UK’s most popular staycation choices. Locations offering scenic views, beach access, or proximity to nature consistently attract visitors year after year.

This ongoing demand underpins the long-term viability of holiday lodge investments, particularly in established tourism destinations with limited new accommodation supply.

Important considerations before investing

Holiday lodges are not risk-free, and understanding the trade-offs is essential.

Seasonality

Income is typically seasonal, with higher earnings concentrated around spring, summer, and school holidays. Investors should assess projected annual net returns rather than focusing solely on peak-season performance.

Ownership structure and fees

Holiday lodges are rarely freehold residential assets. Lease lengths, licence agreements, site fees, service charges, and usage restrictions vary between developments. Understanding these terms upfront is crucial.

Capital growth expectations

Holiday lodges are primarily income-led investments. While capital appreciation can occur in prime locations, investors should view income as the main return driver rather than relying on resale growth.

Example of a holiday lodge investment: Cairns Hill

A strong example of a countryside-led holiday lodge investment is Cairns Hill, located in New Cumnock, Ayrshire, Scotland.

This area is known for its natural beauty and access to attractions such as Glen Afton and nearby nature reserves. Locations like this benefit from established tourism demand, limited local accommodation supply, and strong seasonal booking performance.

For investors assessing whether buying a holiday lodge is a good investment, opportunities like Cairns Hill demonstrate how location quality, operator management, and demand fundamentals drive performance over time.

Who are holiday lodge investments best suited to?

Holiday lodge investments are typically well suited to investors seeking hands-off income, portfolio diversification beyond residential buy-to-let, lifestyle-led assets, higher short-term rental returns, and income-focused strategies.

They may be less suitable for investors whose primary objective is long-term capital appreciation or those who require guaranteed, fixed monthly income year-round.

Holiday lodges vs buy-to-let

Holiday lodges and buy-to-let serve different purposes. Holiday lodges often offer higher nightly income but seasonal demand, while buy-to-let provides steadier monthly rent and broader resale markets.

Many investors choose to hold both, using holiday lodges to complement traditional residential property rather than replacing it entirely.

Is buying a holiday lodge a good investment in 2026?

For the right investor, yes.

Buying a holiday lodge can be a strong investment when the location has proven tourism demand, the resort is professionally managed, income expectations are realistic, and the investment aligns with wider portfolio goals.

As demand for UK short-term accommodation continues to grow, well-located holiday lodges are likely to remain attractive for income-focused investors in 2026 and beyond.

Holiday lodges are not a shortcut to guaranteed returns, but when chosen carefully, they have earned their place as a credible alternative property investment.

Investing with Advantage Investment

At Advantage Investment, we specialise in sourcing alternative property investment opportunities aligned with changing market behaviour and long-term demand.

Our focus is on strong locations, professional management structures, transparent income modelling, and long-term sustainability.

If you are considering holiday lodge investments, short-term accommodation, or alternative property strategies, our team can help you assess whether they fit your goals and portfolio.