The gross holiday let premium in Cornwall is 140% for a 3-bed house, but after Airbnb fees, council tax, insurance and maintenance, the headline shrinks. This article runs the numbers for both a 3-bed house and a 2-bed apartment, because cost structures differ materially: apartments come with a lower entry price but add service charges that houses don't pay.
3-Bed House: Holiday Let Nets 5.1%, Buy-to-Let 1.4%
For a typical Cornwall 3-bed house priced around £303,831, the after-costs picture looks like this. The holiday let column assumes self-management (the dashboard default); the buy-to-let column assumes a letting agent at typical UK market rates of around 11%.
| holiday let | buy-to-let | |
|---|---|---|
| Property price | £303,831 | £303,831 |
| Gross revenue | £30,936 | £12,501 |
| Airbnb fees (15.5%) | £4,795 | — |
| Letting agent | — | £1,353 |
| Insurance | £1,432 | £584 |
| Maintenance | £4,460 | £3,676 |
| Utilities | £2,340 | £290 |
| Council tax | £2,274 | — |
| Holiday let tax | $0 | — |
| Total costs | £15,301 | £8,177 |
| Net income | £15,635 | £4,324 |
| Net yield | 5.1% | 1.4% |
A note on Airbnb fees specifically: the 15.5% rate above is Airbnb's host-only fee, the UK default. Other platforms charge differently. Vrbo runs at roughly 8%, Booking.com closer to 15%, and direct bookings carry no platform fee at all. Many Cornwall hosts list across two or three platforms to spread the load.
Airbnb Fees and Maintenance Eat the House Premium
The two costs that hollow out the holiday let revenue line are Airbnb fees (£4,795) and short-let maintenance (£4,460). Together they consume around half the premium that holiday letting earns over a long-term tenancy. Maintenance is higher for holiday lets because the model already includes furnishing replacement, deeper turnover cleans and the wear-and-tear of weekly guest changes. Buy-to-let maintenance (£3,676) is routine repairs only.
Utilities are the third structural difference. A holiday let host pays utilities directly (£2,340/yr) because guests don't take meter readings. A buy-to-let landlord typically pays nothing on utilities; the tenant runs the accounts in their own name. The same logic applies to council tax: in buy-to-let the tenant pays the council directly, so the landlord's column shows nothing. For holiday lets the Cornwall picture is messier (more on tax below).
2-Bed Apartment: Lower Entry Price, Plus Service Charge
A 2-bed apartment in Cornwall sells for around £183,422, materially below the £303,831 house price. The trade-off is the service charge that any leasehold flat carries, plus typically lower nightly rates for holiday lets and lower weekly rents for buy-to-let.
| holiday let | buy-to-let | |
|---|---|---|
| Property price | £183,422 | £183,422 |
| Gross revenue | £20,791 | £9,289 |
| Airbnb fees (15.5%) | £3,223 | — |
| Letting agent | — | £975 |
| Insurance | £871 | £371 |
| Maintenance | £2,832 | £2,219 |
| Utilities | £1,620 | £170 |
| Council tax | £1,373 | — |
| Holiday let tax | $0 | — |
| Service charge | £1,735 | £1,735 |
| Total costs | £11,653 | £6,843 |
| Net income | £9,138 | £2,446 |
| Net yield | 5.0% | 1.3% |
The service charge appears in both columns because it is a property-level cost that applies regardless of rental strategy. A leasehold flat owner pays the freeholder for buildings insurance, communal repairs and (in coastal blocks) often a sinking fund for cladding, balconies and roof works. Many Cornwall holiday flats also carry a separate management charge from the block's letting agent, which is not the same thing as the holiday-let manager discussed later.
House vs Apartment: Net Yield Comparison
The house and apartment routes lead to different outcomes. Cornwall houses sell for around £303,831 versus £183,422 for a 2-bed apartment, a substantial difference in capital outlay. But apartments add the £1,735/yr service charge, a fixed cost that doesn't scale with rental income. For an apartment to compete on net yield, the price discount has to outweigh the service charge drag.
The numbers tell the story: as a holiday let, the 3-bed house nets 5.1% versus 5.0% for the apartment. As a buy-to-let, the comparison is 1.4% (house) versus 1.3% (apartment). For most Cornwall locations the house wins on yield because tourist demand favours larger family-friendly properties (sleeps 6+) over 2-bed flats, while the service charge takes a fixed bite out of the apartment's gross. Apartments compete better in the seafront and harbour-view bands of St Ives and Falmouth, where premium flats command nightly rates closer to a house.
These are county-level medians across all 315 Cornwall postcode districts. Individual neighbourhoods diverge significantly. The dashboard shows postcode-level data for every bedroom count and property type.
Holiday Let Breaks Even at 20% Occupancy
The gross break-even point is 20%, the occupancy at which holiday-let gross revenue equals long-let annual rent. Cornwall's market median sits at 47%, comfortably above that floor. Treat 20% as the line where holiday letting still makes sense, not as a target. Below it, the extra cost and effort of running a holiday let stops paying off relative to the simpler buy-to-let route.
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Hiring a Letting Agent Adds £6,806 for the House
The tables above assume self-management. If you live outside Cornwall (the typical second-home buyer profile), you'll likely need a holiday-let agent. Local agencies in Cornwall (Classic Cottages, Cornish Cottages, Sykes) typically charge around 22% of gross revenue for a fully-managed service that handles bookings, guest comms, key handover, cleaning coordination and emergency callouts. For a 3-bed house that adds roughly £6,806 per year, dropping the net yield to 2.9%.
That is still ahead of buy-to-let on yield, but the gap narrows considerably. The decision often comes down to time and distance: if you live within an hour of the property and can handle changeovers yourself, self-management pays handsomely. If not, factor the agency fee into your numbers from day one.
The FHL Tax Advantage Is Gone
The Furnished Holiday Lettings (FHL) tax regime was abolished from April 2025. Previously, holiday lets enjoyed full mortgage interest relief, capital allowances on furnishings and pension-contribution status. None of that applies any more. Holiday lets and buy-to-let are now taxed equivalently: mortgage interest is restricted to a basic-rate (20%) tax credit, and rental profits are taxed as personal income. The financial comparison between the two strategies is more important than ever, because the tax wrapper is no longer doing the heavy lifting.
Cornwall-specific issues remain. Holiday lets that meet the 70-nights-actually-let threshold can still register for business rates rather than council tax, and many Cornwall holiday lets qualify for Small Business Rate Relief (often 100%) on properties with a rateable value under £12,000. That can wipe out the council tax line shown in the table above. Outside designated holiday-let zones, converting a property from residential use may also require planning permission as a change of use; check with Cornwall Council before assuming the conversion is a paperwork formality. Stamp duty applies on purchase, with the second-home surcharge adding 5 percentage points; speak to your solicitor for the exact figure on your purchase price.
For methodology see data sources and our market score methodology. Data reflects market conditions as of April 2026.
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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.