Calculate Your Return on Investment on a Shepherd’s Hut

If you’ve been looking for another stream of income, another way of life, or just a home office, a shepherd’s hut could be the perfect solution for you.

For landowners and glamping operators across the UK, a shepherd’s hut is a working asset that generates real income from land that is already sitting there.

The question most people research first is whether the numbers stack up. The answer, for most buyers, is that they do, and often faster than expected. What changes the calculation is how you buy. One route is to purchase a hut outright, which with our afford options like the Shetland, is more achievable for some people. Here at Black Sheep, however, you have the option to finance your purchase through our lenders. Paying through a monthly payment is a solution that could tip the scales even further in your favour.

This page sets out what a Black Sheep shepherd’s hut could realistically earn, what it costs to finance one, and how quickly you could expect to see a return.

Shot of dirt road through farmland under blue sky

What can a shepherd’s hut earn

Looking at the latest nightly rates on Airbnb, a shepherd’s hut could fetch between £115 and £240 depending on location, facilities, hosting and style of retreat. There are even more expensive huts available, offering a lavish champagne-filled retreat for £400 a night.

Glamping sites with shepherd’s huts generally achieve an annual occupancy rate of 50%-65% for standard setups, whilst if marketed properly and featuring premium options, this could rise to 75%. First year occupancy rates are bound to be lower, and it’s better to be more conservative when starting out and forecasting an initial occupancy rate of around 30% until you’re established.

If you take a conservative 30% occupancy rate for the first year, at £150 per night, you could be looking at around 109 nights booked for a total gross return of £16,350. For premium and high-end locations, that could rise to £23,980 at £220 per night.

With strong performance and doing the right things to increase awareness of your shepherd’s hut, you could break even on your shepherd’s hut after just 15 months.

Return on Investment projection for your shepherd’s hut

The below graph gives you a return on investment example for each of our shepherd’s huts, a price per night, whilst you also have the option to buy a shepherd’s hut on finance and spread the cost over six years with monthly payments, so you can be earning sooner than having to save up for the full purchase price.

Whilst we have given guide figures for the first first years at net profit, our Black Sheep Shepherd’s Huts are designed to last up to 20 years with regular maintenance and repairs. This gives you even more years of usage and time to give you an even better return on investment, depending on how you decide to use the hut.

These figures are projections, and the revenue from a shepherd’s hut will depend on various factors such as type of hut, location, availability, and marketing, as well as external factors like weather and financial situation.

Want to chat through your shepherd’s hut return on investment potential?

Whether you want to discuss an upcoming project or are just thinking about getting started, we have experience in helping glamping sites of all sizes find success with our shepherd’s huts. Get in touch today.