5 Ways Tourism Benefits Property UK

Category: Capital Growth

Tourism is one of the world’s largest and fastest-growing industries. In 2024, the UK saw 41.2 million visits from overseas residents, who spent £31.5 billion, according to ONS and Visit Britain. Domestic tourism also accounts for a large amount of the tourism in the UK, with residents reaching 117 million overnight visits, spending a total of £31.3 billion.

The benefits of tourism are endless, but let's look at the top 5 that affect the UK property market.

Author: Becky Mundie

Digital Marketing Executive

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1. Economic Growth

One of the largest benefits of tourism is the economic growth it offers. From the income generated and boosted local businesses to the creation of jobs, many economic aspects benefit from tourism in the UK.

Regular events attract tourism numbers and create strong economic growth. Some events and tourist attractions even give back to their local communities in infrastructure investments, like local football stadiums. The Premier League alone contributed £7.6 billion to the UK economy in 2022 through both direct revenue and job opportunities. Another prime example of the benefits of tourism can be found in Liverpool. The city sees £6.25 billion added annually to its economy from tourism.

Such an increase in spending in tourist cities and certain hotspots creates a ripple effect on the surrounding property market, increasing demand and prices with it. Tourism greatly benefits the economy, big or small. In turn, a strong economy can invest in community development and improve infrastructure. Homes can be built, the public realm expanded, and transport improved. All in all, it creates desire, which attracts more visitors and builds on an already resilient, sustainable economy.

2. Improving Infrastructure

One of the benefits of tourism that is more obvious is the ability to improve infrastructure. As a location’s tourist status strengthens, its economy grows in the process, then it can invest money into the local infrastructure. Community development and improving existing infrastructure create many social benefits. The likes of improving transport links, like road and rail networks and direct connections to airports, make visiting such locations far easier and more enticing.

Some of the best regeneration projects in North England revolve around improving the public realm, transport, and the business sector. Such funding from a local economy can build on preserving its heritage, like Hull’s Fruit Market, improve the environment to create greener cities, and craft better public realms to strengthen community pride. In this way, tourism benefits the quality of living in these locations, as making a city more desirable does not just attract more tourists, but it also improves the lives of residents.

3. Rising Rental Demand

For property investors, one of the best benefits of tourism is the rise in demand. The improved infrastructure, also a benefit of tourism, is a key reason the demand for property is rising amongst residents. This is mainly due to enhanced transport and public realm, making a city more desirable and easily accessible. Demand is also high for both assured shorthold tenancies and short-term rentals as a result of tourism levels rising and people looking for short stays in the UK.

According to Visit Britain, in 2024, there were 105.61 million overnight trips made by UK residents in Great Britain. These trips made a total of 307.54 million nights, with £32.92 billion spent during these stays, according to VisitBritain.org. Each of these visits required accommodation, highlighting the demand for property in the UK as a result of tourism.

4. Employment Opportunities

Tourism benefits residents by creating more employment opportunities. In 2024, data from the World Travel & Tourism Council (WTTC) shows that tourism in the UK supported over 4.1 million jobs, which is around 11.3% of all jobs in the country. These jobs are in existing permanent roles, like accommodation and hospitality, or in more temporary roles for pop-up events, like construction or attractions.

It is not just jobs linked directly to the industry that benefit from tourism, though. As the local economy grows, more investments can be made to create more workspaces. This is already being seen in Leeds South Bank and Liverpool Waterfront. This creates various opportunities for construction jobs as cities expand, as well as attracting working professionals looking to fill these high-quality spaces. The North is already rife with such regeneration, even seeing business giants migrating to call these cities home.

5. Growing Property Values

Tourist hotspots can be misconstrued to have a negative effect on the property market. As the desirability and demand to visit certain areas increase, so does the value of a property. And, as demand and supply for short-term rentals rise, the constraints on hotels and traditional long-term rentals rise too.

However, tourism greatly benefits property investors thanks to growing rental demand and prices. While property prices may grow in these areas, there is fantastic potential to take advantage of a growing market to profit, while the current house price growth rate is moderate.

Property values vary between city centres and their suburbs, depending on their investments and desirability. But tourist hotspots can offer some of the best rental yields in the UK. Especially if investing off-plan, buyers can purchase the property below its market value before receiving instant equity once construction is complete.