The recent boom in the prices of property on the Shetland Islands may come as a surprise to anyone focused on getting the best return from their second home by concentrating on sunnier and more accessible climes.
With the internet increasing the availability and possibility of promoting your second home as a holiday let it’s never been easier to create extra income from a second home by letting it to holidaymakers. For those looking at second home ownership as much as a financial investment as a weekend bolthole this might lead them to the conclusion that the best returns can be made in holiday hotspots as this gives access to the potentially lucrative holiday market. While it may be true that holiday hotspots have proved an attractive proposition from a financial perspective the example of the Shetland Islands demonstrate some of the other factors that may be at play.
Not that the Shetland Islands don’t have a draw for visitors with their rugged coastline, beautiful scenery and evocatively bleak setting, but with a thirteen hour ferry journey from Aberdeen and a daily average temperature high that rarely goes above 14.5°C it’s not the first choice for jetsetters seeking summer sun.
So what is driving Shetlands dramatic increase in property prices, which, over recent years have seen rises at rates similar to those found in some of London’s most exclusive boroughs? The answer to this is most likely found from the islands flourishing oil and gas sector. Although oil prices have tumbled over recent years the impact on the Shetland industry has not been so dramatic, and it’s estimated that between 2012 and 2014 the number of temporary oil and gas construction workers on Shetland rose by about 60%. This influx has brought with it opportunities for others to provide goods and services to the construction workers which has further helped to strengthen demand.
This increasing demand means that since 2003 house prices in Shetland have increased more than any other part of Scotland, roughly doubling in real terms. Although some of the construction workers may choose to settle or buy a property of their own on Shetland it’s possible many are on medium term contracts and only need somewhere to stay on a temporary basis, making the Shetland Islands an intriguing opportunity for the would be second home owner.
Intasure can help you get the cover you need as a Second home owner. Give our friendly second home insurance team a call on 0345 111 0680 to find out more.
*The opinions and views expressed in the above articles are those of the author only and are for guidance purposes only. The authors disclaim any liability for reliance upon those opinions and would encourage readers to rely upon more than one source before making a decision based on the information.
April 13, 2017
Published by: intasure