Some British districts are synonymous with particular industries and, in the case of the North Yorkshire town of Settle,
that industry is rural tourism.

Settle is located in the Craven district, a scenic part of North Yorkshire that’s nestled between the Forest of Bowland (Area of Outstanding Natural Beauty) and the Yorkshire Dales National Park. These are both hugely popular tourist haunts: the Forest of Bowland attracts millions of daytime visitors every year, while the Dales attracts nearly 5 million. Of these, more than 700,000 typically stay overnight.

Positioned between the two, and set just 40km (25 miles) southeast of the Lake District, Settle makes an ideal base for tourists who want to sample the very best of the rural North West.

Settle, the Village

Settle itself is a relatively small, and certainly very attractive market town. It has a population of little more than 2,500 but it forms a vital part of the region’s tourism offering. It is host to a busy calendar of events; everything from a storytelling festival to shows, fairs and galas. It boasts a flowerpot festival, ‘the Malham Safari’, a walking festival and various talks and walks, which are held throughout the year.

Local attractions include, amongst others, art galleries, two museums, a popular garden centre, some excellent restaurants and a theatre. The town is also home to its own rugby union sports club (North Ribblesdale RUFC), an amateur football club (Settle United AFC), and a high street packed with welcoming shops, pubs and cafes.

It also marks one end of the historic Settle to Carlisle Railway, which first opened in 1875 and incorporates the iconic 24-arch Ribblehead Viaduct. With a length of 400 metres (1,300ft), it has been described as “one of the great Victorian landmarks of northern England.” The route, which recently featured on the Channel 5 TV series, The World’s Most Scenic Railways Journeys, is an important tourist attraction in its own right.

This has all helped to make Settle a honeypot for tourists and has established the town as one of the most popular destinations in the region.

Visitor Accommodation in Settle

The town’s popularity has given it an obvious appeal to property investors and homeowners with spare rooms who want to capitalise on the perennial demand for overnight accommodation. As a result, over 400 local properties have been turned over – partly or in whole – to short-stay lets, and the standard is generally very high. Indeed, based on over 30,000 Airbnb customer reviews, visitor accommodation in Settle was recently rated as the best in the country.

Such numbers might suggest that there’s strong competition between property owners but, in fact, occupancy levels are consistently high and ‘no vacancy’ signs are commonplace. Demand has risen markedly in the town since the Covid pandemic, surpassing visitor numbers in 2019 and earlier years. The popularity of the ‘UK staycation’ has boosted the fortunes of holiday let investors and, since 2020, average rental values have rocketed.

Part of the town’s appeal to overnight visitors is that it grants easy access to not one but three tourist destinations: the Dales, the Lakes and the Forest of Bowland AONB. Collectively, they afford a wealth of opportunities for relaxation, sightseeing and outdoor pursuits, so Settle makes a logical base for extended stays that take in all three. Some of the most popular activities include:

· Canoeing / sailing / other watersports

· Fell running

· Mountain biking

· Nature-watching

· Painting and photography

· Rock climbing

· Visiting historic homes, parks and gardens

· Walking / hiking

· Wild swimming

In addition, of course, each of the surrounding areas offers its own distinct attractions and a unique mix of pursuits.

The Yorkshire Dales National Park

Settle is located on the southwest edge of the Yorkshire Dales; it’s very much a part of them and many people come to the town to take part in the activities for which the area is particularly well known. Examples include potholing, visiting show-caves, waterfalls walks and the gruelling Three Peaks Challenge – a 24-mile trek that encompasses the lofty summits of Ingleborough, Whernside and Pen-y-ghent.

Other notable walking destinations include Malham Cove, Goredale Scar and Malham Tarn, which have provided scenic backdrops for such TV and film productions as The Witcher, Wuthering Heights and the Harry Potter series.

The Yorkshire Dales is unquestionably one of the most attractive and well-loved rural regions of Britain but its appeal is now international. In January 2021, it was named by TripAdvisor as the Best National Park in Europe. It was a winner in the organisation’s annual Travellers Choice Awards.

This rising profile, together with a buoyant tourism market provide an excellent foundation for growth. Indeed, the Yorkshire Dales National Park Authority has just such plans; in its latest Park Management Plan, it sets out its ambition to grow the value of local tourism “by at least 5% in real terms by 2024.” This should drive demand for property yet higher, at a time when the market is already over-subscribed.

The Forest of Bowland AONB

The Forest of Bowland abuts the Yorkshire Dales along a boundary that is roughly defined by the road between Clapham and Settle Golf Club, the latter of which lies only 1.5km (less than a mile) from the town centre. The AONB is therefore right on Settle’s doorstep and it opens out into a wide expanse that embraces wild moorland, country parks, picturesque villages, ancient monuments and beautiful wildlife reserves.

Though it’s extremely popular amongst day-trippers, the AONB is largely undeveloped and aside from a sprinkling of campsites, holiday cottages and rural hotels, it offers relatively little in the way of overnight accommodation. As a result, visitors will sometimes stay outside the area to give themselves more options during a multi-night stay. Settle, of course, is one of the outlying towns that is so favoured.

The Lake District National Park

With so much beautiful open space nearby, it’s easy to overlook the fact that the edge of the Lake District is also within very easy reach. The town of Kendal lies just 45km to the northwest along the A65 and, as the crow flies, it’s just 55km to the shores of Windermere. By car, that means a journey of less than an hour.

The Lake District is one of the most scenic and best-loved regions of Britain. Its visitor economy is huge – exceeding £3 billion in value – and the county as a whole attracts over 47 million tourists every year; this is a number that typically includes around 6.6 million overnight visitors. Some of the area’s most visited attractions include:

· Towns such as Ambleside, Bowness, Grasmere, Keswick and Windermere

· Large lakes including Windermere, Coniston and Ullswater

· Numerous museums and galleries

· Historic parks and gardens

· The Cumbrian Fells

Cumbria has benefited more than most from the recent rise in domestic tourism. In April 2022, the Sykes Holiday Letting Outlook Report named the Lake District the UK’s highest-earning region for holiday lets. It estimated the typical earnings of a 2-bedroom property at £25,000 per annum. The region also saw the UK’s biggest post-pandemic increase in bookings (+85%.)

However, while it’s clear that the Lakes attract an immense visitor population, the area can become extremely packed, creating serious problems with parking, traffic congestion and the availability of bed-space. Many families therefore choose to base themselves just outside the National Park boundary, where prices are more affordable, crowds are fewer and where they have access to a much wider choice of destinations. Settle is one such location and recent market data suggests that it has benefited greatly from the continuing staycation trend.

Property Prices

Settle is based in the Settle and Ribblebanks ward, which – according to the latest (March 2022) ONS report “Price Paid by Ward” – saw year-on-year growth of +9.44%. In just 12 months, average residential values in the town rose by +£21,000, from £222,500 to £243,500.

By national standards, however, local property prices are still relatively affordable; a little below the mean. For example, in its latest (March 2022) house price index, ONS cites a UK-wide average of £278,000.

By way of comparison, it is interesting to note the average prices listed by ONS for other popular tourist towns nearby:

Yorkshire Dales

Ingleton: £273,000

Hawes: £282,000

Sedbergh: £292,500

Skipton North: £285,000

The Forest of Bowland

Dunsop Bridge: £375,000

Hornby: £320,000

Slaidburn: £530,000

Lake District

Ambleside: £467,888

Bowness: £385,000

Windermere: £321,300

Despite its excellent location, Settle has evidently remained a town where investors can still buy relatively cheaply. However, before accepting that as a safe, broad assumption, it’s important to note that prices vary considerably by property type and, of course, by the precise location. Older, smaller properties may be considerably cheaper than the local average, particularly if they are set in the district’s outer reaches, away from shops and other local amenities. By contrast, some of the most desirable – and thus the higher-priced units – may well be more modern, larger and set close to the town centre.

Data from Zoopla shows the clear disparity in prices between properties of different types in Settle:

Detached: £518,013

Semi-detached: £297,538

Terraced: £232,027

Flats: £186,488

These distinctions are important to bear in mind. In general, however, it’s probably fair to say that the town is characterised by reasonably competitive prices, and so investors should be able to make their money work a little harder here. And significantly, Settle is part of a wider region that is expected to deliver faster house price growth than anywhere else in the UK.

In May 2022, Savills revised its 5-Year Mainstream Residential House Price Forecast to take account of mounting economic pressures. It revised down its price predictions across the UK, but the reduction was only very modest in the North West and in Yorkshire & Humber. The two regions are expected to see cumulative capital growth of +18.4% by 2026, which would be the highest rate in the UK, and which compares against a national average of just +12.9%. (Savills’ previous 5-year forecast was for growth of +18.8% in the two regions.)

Partly, this upbeat forecast from Savills reflects the relative affordability of property in the two regions. This, in turn, allows more room for price growth and presents fewer affordability barriers. The lower prices also mean that, all else being equal, better yields should be achievable.

Rental Yields

LiveYield reports that across the Craven district (of which Settle is part) yields have been averaging around 3.5%. However, this is a mean figure that encompasses the wider district and all property types within it.

Looking more closely at the company’s data for the BD24 postcode (i.e. for Settle, Giggleswick and Horton in Ribblesdale), yields tend to be higher for smaller properties: between 4.0% and 5.4% for 2-bedroom properties, but as little as 1.2% for those with 3, 4 or more bedrooms. Of course, returns may be also be a function of each property’s age, price and target market but it seems broadly true that smaller and more energy-efficient properties tend to command proportionately better rental prices and yields.

There is little data available to show changes in average rentals at a very local level, but the Homelet Rental Index indicates that across Yorkshire, average rental rose, year-on-year, by +8.1%. This, of course, is a figure that will comprise both short-stay and AST-type rentals.

Local Housing Demand

Thus far, we have focused on the tourist market, given Settle’s important role within the area’s visitor economy. However, demand from local residents is another factor that is driving growth in rental values and longer-term capital values.

According to Craven District Council’s Five-Year Housing Land Supply report (2020 – 2025), the district has been building new homes, but not at a rate that is keeping pace with demand. It notes that “The housing requirement for the plan period 1st April 2012 to 31st March 2032 … is for 4,600 net additional dwellings. This equates to an annual average housing requirement of 230 net additional dwellings per annum.” However, the annual rate actually achieved over that period has equated to only 181 net additional dwellings. It acknowledges that “This is a shortfall of 49 dwellings per year (or a total of 392 dwellings over the 8 years) since 1st April 2012.”

The figures highlight a situation that is common to many British towns and villages: social changes have led to many more potential buyers for properties than there are homes available. This supply gap has played a key role in sustaining ongoing growth in both capital and rental values.

What’s more, when the council factors in the need to make up the existing shortfall, plus the need for a +5% buffer, it calculates an even higher annual requirement. It states that “the total five-year housing land requirement for Craven (including the 5% buffer) is 1,619 dwellings, or 324 dwellings per year.” It therefore seems probable that the shortfall in supply will persist in Settle and the wider district and, consequently, that average values will continue to grow.

Summary

For property investors, Settle has an obvious appeal. It is benefiting from the continuing growth in domestic tourism and from the post-pandemic preference for outdoor pursuits and open green spaces. It provides a scenic base from which visitors can explore not only the Yorkshire Dales National Park, but also the Forest of Bowland and the ever-popular Lake District.

Despite its excellent strategic location, however, average property prices are lower than they are in many parts of the Lakes and Dales, making for realistic and higher-yielding investments. Holiday properties in the Yorkshire Dales and Cumbria have been amongst the UK’s most lucrative property assets in recent years, and tenant demand seems only likely to grow.

In response, perhaps, average rents and capital values have been rising rapidly, by +8.1% and +9.44% respectively. The UK’s present economic challenges will likely create some dips and troughs in the next year or so, but the longer-term forecasts point to steady and sustainable growth.

The market essentials are all there: supply is exceeding demand in Settle, the staycation trend is gathering pace, average prices remain relatively affordable, and short-stay properties have established a long track record of delivering impressive financial returns.

To find out more about property investment opportunities in Settle and the Yorkshire Dales, please call our advisory team on 01244 343 355 or fill out the form below to arrange your free, no obligation consultation call.

Spotlight on Settle