How to Set the Rental Rates for your Holiday Home

If you want to rent your holiday home to tourists, it's important to set your rental rates before you put it on the holiday rental market. If you’re a self managing owner it’s up to you to set your rental rates yourself. Getting it right is vital to getting those all important bookings and enquiries.

This simple guide can be used by those new to renting, or looking to put themselves at a competitive position in the market. We also have information about the best way to display your rates, when advertising online.

Check out the competition

First of all use the Rental Income Calculator. This clever little tool will give you an approximation of how much a property like yours can earn in your area. You will also receive a free guide that will tell you:

The average high season and low season rate in your area
The range of high season and low season rates in your area
Whether or not a swimming pool adds value to lettings in your area
Pricing techniques to attract guests

Use Now

There are also other qualities travellers look for in a holiday property when booking their holiday. These are variables that can effect how much rental income you will make. We advise reviewing similar properties advertised on websites like and Owners Direct and have a look at the prices other properties rent for. Find properties that are similar to yours, to give yourself a realistic idea of how much rental income you could earn. Points of comparison include:

The location
The number of bedrooms
The property type
Special facilities (such as a pool)

If you have a desirable facility or feature you may be able to charge even more. We advise reviewing holiday homes that are similar to yours, advertised on websites like and Owners Direct.Try and find as many properties in your area that you feel are of the same standard. By comparing your property to other holiday homes advertised on the HomeAway UK sites, you may find you have a luxury property which can rent above the going rate.


Points of comparison to look out for include:

    Type of property
    Special features
    Luxury facilities
    Standard of upkeep and decor
    Proximity to hot spots, or in a highly sought after area
By "hot spots" we mean places that would be appealing to tourists. A holiday cottage right on the beach or overlooking the bay will rent for more than a place a ten minute walk away. The same rules apply to attractions in coastal, countryside, mountainous and city areas.

It is also worth having a look at comparable areas, e.g. an area that caters for a similar market, and has similar properties to yours (for example the almost identical resort a half an hour drive away) to reaffirm your findings.
Please note: One of the most common mistakes home owners make when setting their rental rates are pricing their properties too high or too low.

If you set your prices too high: It is unlikely that anyone will book an overpriced property, especially if they can get something identical down the road for less. Sometimes you can increase your prices if you offer a special facility or service to travellers. If you’re thinking of doing this put yourself in the traveller’s shoes and ask “Is this worth the extra cost to the guests?” A family of four is likely to pay the extra cash for a private swimming pool (especially if the beach is a walk away). Having an inflatable paddling pool in the garden might not swing it.

If your rental rates are too low: Funnily enough this is one of the most common mistakes made by holiday home owners. Many home owners think having the lowest rental price on the web page will attract customers. When travellers see adverts for holiday homes that are priced significantly lower than other properties of the same standard, the normal reaction is to think "What’s wrong with it? What are they covering up?"

Be confident that you’re worth the going rate. Charging perhaps twenty pounds less to get the edge over the market is fine, but don’t lower your prices to the extent that you’ll be making a loss. A sensible traveller will know what to expect for a certain price, and will think anything that falls below that rate is sub standard. We know you have a great holiday home, so why sell your self short?

Determine your seasonal rates

The first job you’ll have to do is set your rental prices for the different seasons. This sound simple, but if you aren’t specific enough, you may be selling you property short.

If your market is relatively year round, then you may only need to charge two different rental rates. If your market is seasonal then charge a lot during peak season, and less off season to attract fill up guests.

If you own in a summer holiday location (e.g. a villa by the beach on the Costa Brava, Spain), then your high season will be throughout the summer. Wherever you own you should always check the school calendars and charge extra for the summer break. Off season charge extra for other school holidays such as Christmas, Easter and the spring and autumn half terms. If you market your property to travellers from outside the UK, you may wish to check the school holiday periods in these countries too.

It’s also acceptable to charge more for special days that make your area in demand, such as festivals or events.
Seasonal Periods Table

This image has been taken from a real advert on The different rental periods are named and the exact dates are clearly indicated. The high season, and school holidays have been taken advantage of. But these owners have made a mistake by not displaying a nightly rate, and allowing guests three night stays during peak season (please see below).

Please note: Many advertisers confuse potential customers by displaying unclear information about the different rental seasons. We recommend being very clear. Having four to six rental periods on your pricing table is recommended. If you charge extra for a particular holiday or event (e.g. a three day annual sports event) its better to include this in the additional information box below.

Top tip: The "Additional Information Box" is where you put anything you can’t fit onto the chart. Here you can provide information about the security deposit, what services are included in the price, and what the additional charges are. If you are advertising on Owners Direct this box is called "Notes on Prices."

Determine your nightly rate

Your weekly rate is the most important, especially if you operate in a "summer holiday" region because most peak time travellers book fortnights. However if you operate in an area where weekend a ways and short stays are popular (such as a city destination), or want to fill up off season, it’s a good idea to include a nightly rate as well. It should be 1/5 or 1/6 of the weekly rate. If weekends are more popular, charge more.

Top tip: If you advertise your holiday letting on, remember to display one nightly rate for week days a another for weekends on the pricing table. Also indicate your minimum stay for different periods.

Set a minimum stay

During your busiest months you should set your minimum stay as one week. Most travellers will want to book by the week, so you’ll be missing out if you let someone stay for just a few days.

However if you operate in an area where weekend a ways and short stays are popular (such as a city destination), or want to fill up off season, then allowing shorter breaks might be a good idea. Often owners set their minimum stay as three nights.

Rental Rates Table

This image has been taken from a real advert on As you can see the owner has not only varied their prices and their minimum stay depending on the time of year. Stratford Upon Avon is a year round destination, that is popular for weekends away. However they owner has cleverly set the minimum stay as one week over the Christmas period, to capitalise on the period when small town properties are most in demand. This owner has made the most of the different demands made by tourists throughout the year.

Top tip: To keep your property occupied during the off peak season why not offer a discount for an extra long stay? Try charging customers one month in the low season, for the same price as one week’s peak season rent. A great way of ensuring your mortgage gets covered. 

Your availability calendar has space for you to include:

Weekend rate
Weekend nightly rate
Extra night rate
Monthly rate

You may wish to add these details where appropriate.

Copyright, June 2010
Updated August 2010