KeyData Summer Report: UK short-let bookings fell in Q2, but higher rates kept revenue steady

Anyone managing a short-let calendar in the United Kingdom this summer already knows demand has cooled.

What the new KeyData Q2 2026 Index adds is the more useful part of the story: it was pricing, not occupancy, that kept the sector’s revenue intact and by that measure, most of the UK held up rather well.

The dip, and the rescue by price

Paid occupancy fell in nearly every region this quarter, most sharply in North West England, down 7%, and North East England, down 5%.

Prices told a different story. Average daily rates rose in every region except Eastern Scotland, where they held flat, with increases ranging from 1% to 5%. In most places, that was enough to stop falling occupancy from turning into falling revenue.

RevPAR, the industry’s preferred measure of income per available property, came out flat or only marginally down across most of the country.

South East England and Southern Scotland broke that pattern entirely, posting genuine RevPAR growth.

The South East combined rising bookings (+2%) with rising rates (+1%) for a 3% gain, the best result anywhere in the report.

Guests, in other words, haven’t stopped paying for quality. They’ve simply become choosier about how often they book it. Operators who resisted the temptation to discount their way back to full occupancy appear to have made the right call.

Where pricing couldn’t close the gap

Not every region weathered this equally well. North West England, North East England, Eastern Scotland and North Wales all recorded falling RevPAR.

Eastern Scotland had it worst of all in one sense: rates there were flat, so there was no pricing cushion at all, and the occupancy drop went straight through to revenue. If your portfolio sits in any of these markets, this is the quarter to sharpen positioning rather than wait for conditions to turn on their own.

Not everyone reads the North West number the same way. Corin Craig Jackson, founder of Manchester-based The Heim, points out that a regional average can blend very different sub-markets together:

"Two different markets sit inside that one regional average. KeyData’s North West figure is weighted toward leisure stock: the Lakes, the Fylde coast, Cheshire; while Manchester city centre runs on events, corporate travel and the airport. One number doesn’t describe either well.

Context matters too. Manchester’s 2025 comparison base included a ten-night stadium residency that pushed occupancy to 93% at a £255 average rate. Strip those nights out and our July rate moved from £192 to £182 - a 5% shift, not the 24% the raw year-on-year comparison suggests.

The bigger competitive pressure in Manchester isn’t short lets, it’s hotels: the city added 60.9% more bedrooms over the past decade, with more in the pipeline. Our own RevPAN ran at £113 across H1, against £79 for comparable Manchester listings. Occupancy is still down year-on-year, but that looks more like our own growth curve catching up than a wider market story."

A market settling, not collapsing

KeyData’s own indices support the “soft landing” reading. The Demand Index, which tracks year-on-year bookings per property, eased to -0.02 in June; barely below flat.

The Revenue Index sat exactly at zero. After the sharper swings of 2023 and early 2024, this looks less like a downturn and more like a market finding its level.

Two extremes: Guests are booking early, or not until the last minute

Booking behaviour has split into two distinct camps this year: guests committing months ahead, and guests booking right before arrival, with fewer landing anywhere in the middle.

That split explains the seemingly unchanged average booking window: 73 days in April, 94 in May, 100 in June; each close to last year’s figures.

The average looks stable only because it’s blending two very different kinds of guest, not because behaviour has stayed the same. A pricing strategy built around “the average guest” risks serving neither one properly.

There’s a related shift worth watching too: stays are running about 2% shorter across the spring months, worth reflecting in your minimum-stay settings if you haven’t revisited them recently.

Direct bookings: fewer of them, but value is higher

Direct’s share of UK reservations has slipped for three years running, from 67% in 2024 to 58% this year, as Airbnb and Booking continue to gain ground. But direct bookings still generate 66% of total revenue from just 58% of reservations, while Airbnb converts 19% of bookings into only 16% of revenue.

Guests who book directly remain, on average, considerably more valuable. That isn’t an argument against OTAs, which are doing genuine work on reach; it’s a reminder not to let your own website and repeat-guest list wither while chasing platform growth.

The comparison that matters: short lets versus hotels

For context, UK hotels had a noticeably rougher quarter than short-term rentals.

Calendar occupancy across the hotel sector fell 9%, and RevPAR dropped 6% — a much steeper decline than the broadly flat picture for holiday lets.

Wales’s hotels fared worst of all, down 25% on RevPAR.

Whatever headwinds the wider accommodation sector is facing, short-let operators are navigating them noticeably better than their hotel counterparts, largely on the strength of that same pricing discipline.

What this means for the rest of Q3

Three things worth carrying through Q3.

Hold rates where the data supports it: discounting into a market that’s already proving guests will pay would be the wrong response.

Build pricing and marketing around two distinct guest types rather than one “average” booking window.

Keep investing in direct channels, which remain a shrinking slice of bookings but, by some distance, the most valuable one.

You can download KeyData’s Q2 2026 report here which includes full regional breakdowns, hotel comparisons and methodology.

All data as of 20 July 2026, sourced from the KeyData Index.