The gross holiday let premium in Cheshire West and Chester is 63% for a 3-bed house, but after Airbnb fees, insurance, higher maintenance, utilities and council tax, the picture changes substantially. This article covers both a 3-bed house and a 2-bed apartment because their cost structures differ: apartments add service charges but enter at a much lower price point, which reshapes the net yield comparison.
3-Bed House: Holiday Let Nets £9,598, Buy-to-Let Nets £7,623
The table below shows the full cost stack for a typical 3-bed house priced at around £265,554. The holiday let column assumes self-management (the dashboard default), while the buy-to-let column includes a letting agent fee at typically 9% of rent.
| holiday let | buy-to-let | |
|---|---|---|
| Property price | £265,554 | £265,554 |
| Gross revenue | £21,426 | £13,130 |
| Airbnb fees (15.5%) | £3,321 | — |
| Rental management | — | £1,218 |
| Insurance | £1,324 | £541 |
| Maintenance | £5,125 | £3,505 |
| Utilities | £2,058 | £243 |
| council tax | £2,172 | £0 (tenant pays) |
| holiday let tax | £0 | — |
| Total costs | £11,828 | £5,507 |
| Net income | £9,598 | £7,623 |
| Net yield | 3.6% | 2.9% |
Note: Airbnb charges hosts roughly 15.5% in the UK. Other platforms differ: Vrbo charges around 8%, while Booking.com takes about 15%. Direct bookings have no platform fee but require your own marketing and booking infrastructure.
What Eats the House Premium
Three line items consume most of the holiday let premium on a 3-bed house. Airbnb fees alone strip £3,321 off the top, the largest single cost differential. Holiday let insurance runs at £1,324 versus £541 for a buy-to-let landlord policy, reflecting the higher risk profile and short-term occupancy turnover. Utilities of £2,058 fall entirely on the holiday let host because guests do not pay bills, whereas tenants in a buy-to-let cover their own electricity, gas and water.
Maintenance is also a notable gap. The holiday let line of £5,125 includes furnishing replacement (sofas, mattresses, linen, kitchenware) on top of routine repairs, while the buy-to-let figure of £3,505 covers structural and appliance maintenance only. Once these costs are stacked, the holiday let lands at a net yield of 3.6% versus the buy-to-let at 2.9%: a real after-cost premium, but much narrower than the 63% headline gross premium suggests.
2-Bed Apartment: A Different Cost Shape
The apartment table below uses the same self-managed holiday let, agent-managed buy-to-let convention. The key structural difference is the service charge, which appears in both columns because it is a property-level cost set by the freeholder regardless of letting strategy.
| holiday let | buy-to-let | |
|---|---|---|
| Property price | £147,495 | £147,495 |
| Gross revenue | £14,722 | £9,487 |
| Airbnb fees (15.5%) | £2,282 | — |
| buy-to-let management | — | £854 |
| Insurance | £790 | £338 |
| Maintenance | £3,044 | £1,947 |
| Utilities | £1,434 | £139 |
| council tax | £1,206 | £0 (tenant pays) |
| holiday let tax | £0 | — |
| Service charge | £1,552 | £1,552 |
| Total costs | £9,102 | £4,830 |
| Net income | £5,620 | £4,657 |
| Net yield | 3.8% | 3.2% |
The service charge of £1,552 is a fixed, non-negotiable cost that hits both letting strategies. It typically covers building insurance, communal area maintenance, lift servicing where applicable, and a contribution to the freeholder's reserve fund. Most leasehold flats in Cheshire West sit in this range, though period conversions can run higher and modern blocks with concierge or gym facilities can run substantially higher.
House vs Apartment: Lower Entry Price Wins on Yield
The apartment enters the market at £147,495, well below the £265,554 required for a 3-bed house. That price gap is the single biggest driver of the yield comparison. Even after the service charge of £1,552 that houses do not pay, the apartment still produces a holiday let net yield of 3.8% against the house's 3.6%, and a buy-to-let net yield of 3.2% against the house's 2.9%.
The trade-offs are real, though. Apartments command lower nightly rates (£122 versus £183 for the house) and lower weekly rents, so absolute cash flow is smaller even when the yield is higher. Houses also tend to attract longer guest stays and family bookings, which can lift occupancy and reduce cleaning turnover costs. For investors prioritising yield per pound deployed, the apartment wins; for investors prioritising absolute monthly cashflow or owner-occupier flexibility, the house has its merits. These are city-level medians: individual postcodes differ, and the dashboard shows postcode-level data for every bedroom count and property type.
Holiday Let Breaks Even at 22% Occupancy
The 3-bed house holiday let breaks even with the buy-to-let alternative at 22% occupancy. This is the gross break-even floor (where holiday let revenue equals the buy-to-let rent of £13,130), not a target. The Cheshire West market median sits at 35%, which is why the holiday let route comes out ahead in the table above. Below 22%, the buy-to-let strategy wins outright with less operational hassle.
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Hiring a Letting Agent Cuts Net Yield to 2.0%
The tables above assume self-management for the holiday let, which is the dashboard default. In practice, many investors outsource. For the 3-bed house, hiring a holiday let manager adds around £4,285 (roughly 20% of gross revenue), which lifts total costs to £16,113 and drops the net yield to 2.0%. That is the trade-off: agent management buys back your time and (often) higher occupancy through professional pricing and listing optimisation, but the fee is steep enough to compress the after-cost return.
Self-management is genuinely viable in Cheshire West because the market is not saturated with full-time hosts and competing professional operators. Investors who live within a reasonable drive can handle key handovers, cleaning coordination and guest communications without losing significant occupancy. The economics shift if you are an out-of-area investor or you scale to multiple units, where the time cost of self-management starts to outweigh the 20% fee.
Tax: FHL Abolished, Mortgage Interest Restricted
The Furnished Holiday Lettings (FHL) tax regime was abolished from April 2025. Holiday lets and buy-to-let are now taxed equivalently for income tax purposes, which removed the historic capital allowances and pension-contribution advantages that holiday let owners enjoyed. Mortgage interest is now relieved at a basic rate tax credit only, which reduces the after-tax return for higher-rate taxpayers regardless of letting strategy. The abolition of the FHL advantage makes the side-by-side cost comparison in this article more important than ever, since the tax wrapper no longer tips the scales.
Stamp duty land tax also applies on purchase, with the 5% additional dwellings surcharge kicking in for any second property. The exact amount depends on price, buyer status and timing of purchase, so confirm the current calculation with your solicitor before committing. Outside Greater London the 90-day holiday letting cap does not apply, so the 330 available nights reflect practical maintenance and turnover gaps rather than a regulatory ceiling. Conversion from a residential dwelling to a holiday let may still require planning permission as a change of use, particularly in conservation areas.
Data reflects market conditions as of May 2026. For deeper context, the methodology behind these figures is documented in our data sources and market score methodology pages, and Cheshire West Holiday Lets Net 3.1% After All Costs covers the same question from the suburb-selection angle, while Manchester Apartments Beat Houses on Holiday Let Yield addresses property-type selection for this market.
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This information is for educational purposes only and should not be considered financial or legal advice. Regulations and market conditions change frequently. Verify current rules with local authorities before making investment decisions.
Methodology and Assumptions
Defaults used in the figures above. All inputs are adjustable in the dashboard.
How available nights are determined
Available nights default to 330 per year, reflecting an active operator with minimal blocked time. Where local regulations cap whole-home short-term lets (for example London at 90 nights, New South Wales at 180), the cap is applied. In markets where short-term rental requires owner-occupancy or is otherwise prohibited for investment properties, available nights drop to zero.
How occupancy is measured
The percentage of available nights that get booked, drawn from market data. A property listed for 200 nights with 100 bookings shows 50% occupancy. Adjustable in the dashboard.
Long-term rental management default
Includes a 9% letting agent fee, the standard arrangement for UK buy-to-let investors who use a managing agent. Self-managed landlords can adjust this to zero in the dashboard.
Short-term rental management default
Set to self-managed (zero management fee) by default, the most common arrangement for individual investors. Hiring a professional manager typically costs around 20% of gross revenue and reduces net yield proportionally. Toggle in the dashboard.
How property tax is calculated
Council tax in the UK is typically paid by the tenant for long-term rentals, so it is excluded from buy-to-let costs. Holiday lets are usually assessed as business rates and may qualify for Small Business Rate Relief, often reducing this to zero.
Local regulations
Check state, council, and HOA rules before investing; these change frequently. The regulations summary in this article reflects the latest data we hold. Always verify the live position with the local authority.
Sampling and data sources
Short-term rental yield figures reflect properties currently listed on short-term rental platforms. In high-tourism markets, listings tend to concentrate in central postcodes, which can pull city-median yields above what residential areas of the same city would achieve. Yields for any specific suburb may differ significantly from the city-wide median.
For metric definitions and broader methodology, see the About page.