Start with the rate, not the asking price
Find five properties a guest would genuinely consider instead of yours. Think the same area, same sleeps, same sort of character, not just the same postcode. Note their nightly rates through the year, then read their calendars rather than their reviews: a calendar that's full three weekends out in November is a good sign of demand.
(Full every single day usually means the owner has blocked it so you can usually discount those.)
The same exercise tells you how deep the market is. Twelve tired listings in a row is an opportunity for you. Three hundred polished ones is a rate war, and you'd be arriving last.
Then the honest maths
- Realistic nights — rural East Anglia mostly runs 50–65% occupancy across a year. This is what you should base your calculation on, not July.
- Gross revenue = your realistic rate × those nights.
- Take off running costs — cleaning, linen, commission, utilities, maintenance. Commonly 35–45% of revenue, before any mortgage.
- What's left services the debt and pays you. Use this to determine what you should pay.
if it only works at 80% occupancy, it doesn't work
A pretty cottage at a premium price whose rate tops out at £110 a night can still be a lovely thing to own — as a lifestyle purchase. Nothing wrong with that but make sure you know why you are doing this.
Check a lender will actually touch it
Holiday lets need a specialist mortgage. Using an ordinary buy-to-let product is a breach of its terms and an all round bad idea. Expect a 25% deposit as the floor, a stress test on whether projected income comfortably covers the interest, and often a minimum personal income requirement on top. Note that the quirks that make a property bookable (think thatch, a pub kitchen, an annexe, land) can also reduce lender demand. Talk to a broker who places holiday lets weekly, before you offer rather than after.
The market sets the rate. The only number you control is the price you pay.
We run this appraisal for clients so that they have this information upfront and not at the last minute. If there's a listing in front of you, we'll tell you frankly if the numbers stack up and is worth the money.