SerpApi.Org
Many people’s garages are full of old junk, but Lindsey Harrad is making thousands of pounds a year from hers.
It is only 15 square metres in size, but she has converted it into a holiday let big enough for two. Complete with a double-bed, en suite, and even a space in which to eat or work, she charges £130 per night.
The magazine editor, 40, lives in the attached house in artsy and picturesque Frome, Somerset, with her two daughters, aged nine and 16. When she first listed the space, now named Willow Lodge, on Airbnb in August 2025, it received its first booking within 48 hours.
The garage conversion is just one of a growing number of “tiny” holiday lets in the UK – accommodation which includes shepherd’s huts, sheds and yurts designed to sleep one or two people.
While the accommodation might be small, the demand for such holidays is growing, perhaps in part because of the rising demand for staycations, with searches for UK trips by residents up 11pc year-on-year, according to Airbnb.
The number of solo travellers is also on the rise, up 60pc in the three years to May 2026 according to Booking.com, and people are increasingly searching for something a bit different when it comes to accommodation – making it an ideal time to spruce up the shed.
Harrad made the decision to convert the garage when she moved into her home last year after renting it out for 20 years. Originally, she intended for the annexe to be somewhere for her mother to stay when she visited, but then she decided to rent it out to holidaymakers too, with Frome attracting plenty of visitors.
Harrad shelled out £16,000 from her savings for building works plus £5,000 for additional fixtures and fittings to kit out the tiny space.
To date, the annexe has averaged £600 to £1,000 of income per month, and Harrad is strict about putting it aside. She hopes to recoup the cost and replenish her savings within two years and then use the income to clear her mortgage early.
“Then, in the future I hope to be able to help my daughters with the cost of university,” she adds.
“We live in an age where we seek an emotive response from somewhere, something different, a uniqueness that stands out,” says Alex Wilson, who set up holiday let business Host Unusual in 2016 in response to what he saw as an emerging trend.
“Tiny homes, including shepherd’s huts, have become popular, offering a nice mix of modern luxuries, comfort and nostalgic charm,” he says.
‘Business has been brisk’
Tiny holiday lets are not only a way to profit from existing garden space or outbuildings, but they are also more affordable to run with low overheads and cheaper energy costs.
When it comes to plumbing, annexes can tap into existing systems, and yurts often make use of water tanks and compostable toilets, keeping costs to a minimum.
Set-up fees are also comparatively small, with basic shepherd’s huts or lodges available for under £20,000, depending on model and finish.
Willowfen Retreat, just outside Kings Lynn in Norfolk, is a purpose built shepherd’s hut, complete with luxury fixtures and fittings, including a stove heater, double bed, shower room and its own garden space.
Amanda Sedgewick, 60, decided to purchase the hut after moving to the adjacent property with husband John, 58, in 2014.
“We are lucky enough to have a smallholding of three acres, and as we live in a lovely touristy area, I decided to put our land and tranquil surroundings to good use,” she says.
The hut cost £36,000 including installation, and Sedgewick paid an additional £900 for planning permission and change of use, which took around three months.
But since its installation, business has been brisk. The hut now yields an average gross income of £15,500 per year, with a 120-night occupancy, and Sedgewick manages it full-time.
Those looking to cash in on their spare garden space or a neglected outbuilding should consult regulations before going ahead, and consider any fees charged by listing sites like Airbnb.
“Homeowners are permitted to build a shed or outbuilding in their garden if it’s incidental to the house. However, if you’re looking to convert or install a building to use as a holiday let, that may well need planning permission,” says Lauren Ashworth, a consultant at the government-funded Planning Advisory Service. “Alternatively, some councils may request that you apply for a Lawful Development Certificate.”
Owners will also need to complete self-assessment tax returns on their earnings. “A holiday let, whether in their garden or a separate property, is taxable in the same way as a rental property, albeit with slightly different rules on profit and deductions,” says Raksha Hirani, the founder of RH Accountant.
“Owners are taxed on profit, so will be able to make some deductions for maintenance and other expenses. While information is available on the HMRC website, I would always suggest running numbers via an accountant.”
It is also crucial to consider how much time you wish to dedicate to running a holiday let.
For Sedgewick, it is all about balance. “We did consider having a second hut, but thought it might spoil the tranquillity we currently offer; plus as I do the change-overs myself and I might struggle to manage with two. This is just perfect.”
Harrad, too, enjoys the flexibility that comes with having the additional space for personal use at times. “It’s really busy at weekends, although midweek can be quieter. But this means we have somewhere for family to stay, and I have somewhere to work when it’s not occupied.”
To her surprise, she has enjoyed the hosting experience, and even the cleaning has its perks. “My teenage daughter often helps with the process of preparing the lodge for guests. We chat away to each other, so it’s really nice.”
