A number of landlords who use short-term holiday rental sites are reinvesting their earnings in refurbishment work helping to provide much needed support for the slowing housebuilding industry.
According to the latest government data, growth in new housing delivery has dropped sharply to just 2% this year, compared with an average of 17% across the three previous years.
However, money that was previously channelled into the hospitality industry is now lining the pockets of ‘Airbnb-style’ landlords, many of which are reinvesting their rental income in home improvement projects, according to new figures from the Federation of Master Builders (FMB)
“This is good news for the UK’s builders and helps explain why small construction firms are reporting strong growth in the domestic refurbishment despite Brexit jitters,” said Brian Berry, chief executive of the FMB.
The FMB reports that 40% of ‘Airbnb-style’ landlords reinvest some of their earnings in refurbishment work helping to support the housebuilding industry.
Berry commented: “The explosion of the sharing economy is helping home owners fund their refurbishment projects.”
Looking at the spending patterns of landlords who use short-term holiday rental sites, the study found that 43% spend the money on holidays; 40% spend the money on home improvement work; 25% put the money towards a new car; 23% spend the extra cash on entertainment, such as ticketed events; 23% save the money; 17% use the money to make ends meet; 10% spend the extra cash on new clothes.
Berry continued: “Home improvement work is the second most popular way in which ‘Airbnb-style’ landlords are choosing to spend their extra cash.
“Our same research shows that currently 3% of British homeowners are renting their own homes out on ‘Airbnb-style’ websites. In the UK, this equates to around 800,000 homes. What’s more, 16% of home owners are interested in renting their homes out in this way in the future – this would equate to more than three and a half million additional properties.”
He added: “Airbnb says that globally, it gains 14,000 new landlords each month on its own platform alone. If this trend continues, and if homeowners remain committed to investing the extra cash in repairing and maintaining their properties, rather than blowing the money on cars and clothes, it will stand the construction industry in good stead in the future.”