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Brexit lingers on. Today in the UK, the staycation holiday continues to grow in popularity, regardless and because of Brexit. The majority of holiday home dealers and parks contacted by the Glass’s Leisure Team suggest the uncertainty surrounding the planned withdrawal on October 31 is to blame for reduced sales of new units. However, comments also suggest demand for used units is increasing versus 2018.
The new market
Market feedback continues to show large amounts of 2019-model year stock remain unsold resulting in fewer dealer and factory orders from holiday parks. The volume of unsold stock is such that forecasts suggest high availability until Easter. This in turn is reducing manufacturer production. Confirming this, figures released by the National Caravan Council (NCC), show holiday home production at the end of July 2019 reduced 11.9% to 12,627 units with dispatches onto holiday parks in the same period also decreasing, with 13,043 dispatched, a decrease of 6.5%.
Comments to the Glass’s Leisure Team include ‘topsy-turvy’ and ‘strange scenarios’ when discussing the market over the past few months. After being steady and stable in recent years, it is unusual to hear phrases like these attributed to the holiday home market.
The market for new units is tricky for manufacturers and parks. The level of production swamped the market to the point where production is reducing whilst built stock discounts are commonplace. Manufacturers and parks are offering strong incentives to potential customers with some parks even offering lifetime leases on new units. The Glass’s leisure team note that customers remain attracted to new units over used due to the incentives on offer.
Feedback from manufacturers and holiday parks confirms mid-range models are currently least popular. Entry-level and premium models are attracting more interest, suggesting there are two customer types in the market. Entry-level models starting around £25,000 continue to attract new customers, especially younger families and previous owners of holiday returning to the market.
Premium models, ranging from approximately £60,000 are attracting older customers, many who have access to larger sums following retirement.
The used market
With more used units with specification from 2012, when manufacturers started including central heating and double-glazing on the majority of models becoming available at reasonable prices, sourcing quality used stock with the correct specification is becoming easier.
Many holiday parks and dealers are of the opinion there is still the possibility the market can grow if sales continue to progress steadily through the next economically turbulent months. Evidence shows that the staycation market is growing. According to Barclays, 31% of holidaymakers want to spend more time in the UK compared to previous years. In the holiday home markets issues persist, including the rising costs of purchasing holiday homes and pitch rates, issues the industry needs to look at as a whole.
Values for the October edition of Glass’s data have been reduced by 2.5%.