Hostels, outdoor activity centres and religious retreats
Source: gov.uk (2025-04-28)

This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.

1. Scope

Hostels cover a wide variety of properties that can be grouped into 7 main categories. Many of this class, except for the most basic properties are likely to be composite hereditaments either where there is long-stay accommodation, where part of a farm or where there is accommodation for a manager or other staff.

1.1 Climbing Huts and Bothies

Climbing huts provide very basic self-contained accommodation with mattresses on bunks or sleeping pallets. Normally there will be rudimentary cooking and toilet facilities but no wardens. The huts are often owned or rented by climbing clubs each member having his or her own key. Reciprocal arrangements are regularly made between kindred clubs to allow their members to occupy climbing huts of other clubs. Members may be required to pay a small fee to stay at these huts.

1.2 Camping or Stone Barns and Bunk Houses

This category often comprises converted farm buildings providing basic facilities although these can vary between buildings. Minimum facilities are normally a sleeping area shared by all visitors, tables and benches used for eating and preparing of food, a supply of cold water and one or more flush toilets. Some may have one, or a combination, of basic heating, hot water, showers and cooking facilities.

1.3 Youth Hostels

The major players in this market aim to offer low price accommodation for those wishing to explore the countryside or visit heritage cities. With the introduction of camping barns and bunk houses meeting the demand for the most basic accommodation, facilities in traditional hostels have been continually improved. Increasingly hostels offer rooms with fewer beds, sometimes with their own washing facilities. Many hostels now have family rooms (2 bunk beds) with ensuite facilities. Guests can often occupy on a self-catering, full or half board basis or a mixture of all these, whether or not a member of the relevant organisation.

Many new hostels have been established in partnership with other organisations such as local authorities and other public sector bodies or voluntary organisations.

1.4 Agricultural Workers’ Hostels

This will cover a range of accommodation, often poor, and will range from converted farm buildings to portacabins and caravans with facilities in separate buildings (see Rating Manual Section185 -Caravans). This accommodation is usually seasonal in nature and will remain in assessment year round unless used for another purpose. Many of these will be borderline domestic/non-domestic and further guidance on this can be found in the Council Tax Manual – Practice Note 8 at paragraphs 4.20 – 4.24.

1.5 Urban Hostels

This covers a wide range of types ranging from commercially run hostels to properties run by charities providing both long and short-stay accommodation, women’s refuges, drug rehabilitation hostels, and staff hostels. Many of these will be composite, or entirely domestic, and further guidance may found in the Council Tax Manual – Practice Note 8 at paragraph 4.11.

1.6 Outdoor Activity Centres

These can range from converted hotels to timber buildings on large sites. Many of the more basic sites will be little more than camping barns. Almost all of the centres will provide hot meals and offer bunk beds, dining rooms, kitchens, classrooms and instructors’ accommodation.

The centres are normally found on large sites. Catering mainly for children and teenagers there will be basic on site activities such as ropes, slides and nets and there will also be storage accommodation for equipment used off site, such as canoes. There are some private operators in this market, although many are run by local authorities and charities. For the largest sites reference should be made to the instructions for Holiday Centres RM : S6: P3 : S490.

1.7 Religious Retreats/Study Centres (Residential)

These are usually in rural or more remote areas and are based in a variety of buildings from abbeys and chapels to large country houses with accommodation ranging from very high quality to shared dormitories. The courses are usually residential with food and accommodation provided.

2. List description and special category code

For hostels Special Category Code 136 should be used. For Outdoor Activity Centres Special Category Code 099 should be used. For Religious Retreats/Study Centres (Residential) Special Category Code 431 should be used.

As Generalist classes the appropriate suffix letter should be G.

3. Responsible teams

Hostels, Outdoor Activity Centres and Religious Retreats are Generalist Classes.

4. Co-ordination

The Hotel Class Co-ordination Team has overall responsibility for the co-ordination of these classes. The team are responsible for the approach to and accuracy and consistency of valuations. The team will deliver practice notes describing the valuation basis for revaluation and provide advice as necessary during the life of the rating lists. Caseworkers have a responsibility to:
- follow the advice given at all times
- not depart from the guidance given on appeals or maintenance work, without approval from the co-ordination team
- seek advice from the co-ordination team before starting any new work
5. Legal framework

Hostels were excluded from Class C1 of the Use Classes Order in 1994 (by SI 1994/724) and are therefore sui generis. Religious Retreats are also treated as sui generis.

There is no definition of ‘hostel’ within planning law. A hostel usually provides overnight or short-term accommodation which may be supervised, where people (including sometimes the homeless) can usually stay free or cheaply. Hostels may provide board, although some may provide facilities for self-catering.

The element of supervision should not be relied upon as a determining factor but as a factor to take into account in considering of the use of the premises. Occasionally, hostels are used to provide longer-term accommodation, although it should be stressed that a hostel is not a residential care home, irrespective of any supervision it may have.

If there is an element of care in the service provision, this might mean that the premises became a C2: Residential Institutions use.

6. Survey requirements

Hostels/Religious Retreats should be measured to Net Internal Area (NIA) in accordance with the VOA Code of Measuring Practice for Rating Purposes except for temporary structures, such as caravans and portacabins, which should be measured to GEA (Gross External Area).

The survey should include the following information:

The type of premises, age, number of dormitories/bedrooms (number of bed spaces in each and whether ensuite or not) construction, services (including heating), the date when last refurbished, type extent and quality of ancillary facilities (areas for dining rooms, lounges and other social facilities should be separately shown), parking, location, details of bathroom and WC facilities; details of any sporting or activity facilities within the hereditament should also be recorded. Full details of any long-term living accommodation whether for proprietors, staff or users of the hostel should be noted.

7. Survey capture

In all cases plans and surveys should be stored in the property folder of the Electronic Document Records Management (EDRM) system.

8. Valuation approach

It is recommended that the unit used for comparison and valuation is a single bed space. This is a berth for sleeping one person - a double bunk will be the equivalent of two bed spaces. The valuer should always “value as you devalue”, so that where analysis is on a single bed space basis, reflecting normal ancillary accommodation, the valuation scheme should be on the same basis. Valuers should still reflect the extent and quality of the ancillary accommodation in the adopted valuations, as well as any additional or unusual rateable features

Evidence of the number of bed spaces is often readily available from the operator’s website or in brochures. Where information is not readily available it can be obtained by contacting the relevant hostel.

In view of the lack of rental evidence and doubts in respect of some of the accounts evidence for this class it is important for valuers to stand back and consider whether the proposed valuation is reasonable having regard to the type, quality and location of the property and the values of other physically similar hereditaments in the locality. Care should be taken to ensure valuations are not out of line with physically similar hereditaments used for holiday accommodation or other purposes.

What rents are available should be analysed both in terms of price per bed space and as a percentage of gross receipts (where commercially operated) so that comparison may be made with those where only the gross receipts are known.

9. Valuation support
- Rating Support Application (RSA)
- Non-Bulk Server (NBS)
- Survaid
- Class Co-ordination team for Hotels (This CCT covers hostels, outdoor activity centres and religious retreats)
Practice note: 2023 - hostels, outdoor activity centres and religious retreats

1. Market appraisal

1.1 As outlined in the Rating Manual these classes cover a wide range of property types.

1.2 Hostels. The principal leisure demand for hostels is from young people, often international travellers, seeking relatively cheap accommodation and a relaxed, friendly, atmosphere. Occupancy and turnover are heavily influenced by factors which impact on decisions to travel to and within the UK.

1.3 Prior to the pandemic hostels saw increasing demand and significant investment in improving facilities, increasingly adding private rooms, sometimes ensuite. However, the COVID19 pandemic resulted in closure of hostels for large parts of 2020 and early 2021 and, because many of the facilities are shared, it was reported that hostels were impacted to a greater extent than standard hotels. Social distancing requirements prevented the operation of shared bedrooms.

1.4 In February 2021 the UK Government published its Roadmap out of lockdown for England which set out four steps to relax restrictions. Step 1 had already taken place by the AVD, although hostels and activity centres were still not allowed to open. The later three stages of the Roadmap for England included:
- the opening of outdoor hospitality and self-contained accommodation, and outdoor dining (Step 2, no earlier than 12 April)
- the opening of remaining accommodation types including hostels, subject to social distancing measures (Step 3, no earlier than 17 May)
- the removal of remaining restrictions on openings/events (Step 4, no earlier than 21 June)
1.5 Subsequent to 1 April 2021 Steps 2 and 3 took place as planned, but Step 4 was delayed four weeks to 19 July.

1.6 International travel was prohibited at the AVD, except for a small number of permitted reasons. Holidays abroad were not allowed. As part of the February Roadmap announcement the government referred to a review of global travel, to report on 12 April, possibly for inclusion at Step 3. At AVD the outcome of this review was unknown, and international arrivals from certain countries had to quarantine in hotels near airports at their own cost.

1.7 The situation in Wales, both leading up to and after the AVD, was similar although not identical.

1.8 Outdoor activity centres. In the period prior to the pandemic there had been a reduction in local authority funded centres, although a number of these had been taken over by independent operators.

1.9 The activity centre industry is well regulated and supported by a number of national organisations which provided advice during the pandemic. Participation in outdoor activities has generally been growing although the pandemic significantly affected the use of accommodation for residential based activity centres. The attraction of thrill-seeking experiences is still strong and will also support the recovery of this sector.

1.10 As for hostels, unless residential accommodation was self-contained activity centres were not expected to re-open until Step 3 of the government’s Roadmap. Even then, social distancing measures meant they would be unable to operate to full capacity until full relaxation at Step 4.

1.11 Religious retreats. There is limited published data available, but the indications are that they will have been impacted by the pandemic in a similar way to hostels and activity centres.

2. Changes from the last practice note

2.1 Market appraisal has been updated in line with economic and general market conditions.

2.2 For the 2017 Revaluation hostels were largely valued using the Rating Support Application (RSA). For outdoor activity centres and religious retreats, however, some were valued on RSA and others on the Non-Bulk Server (NBS).

2.3 For 2023 the following approach should be adopted:

Hostels should be valued on RSA except where similar to budget hotels and valued by reference to receipts. Where a percentage of gross receipts is adopted these should be valued on the Licensed Property Application (LPA).

Outdoor activity centres and religious retreats should be valued on the NBS.

3. Ratepayer discussions

3.1 There have been no central or ratepayer discussions for these classes in advance of preparing this practice note.

4. Valuation scheme

4.1 Available rental evidence tends to be unhelpful largely because of connections between parties or because there has been significant work carried out to the buildings and not reflected in the rent passing. Historically, identifying and obtaining costs of improvements has proved difficult.

4.2 Further, many occupiers are charities or local authorities and there will be occasions where hereditaments are not operated to their full commercial potential. For example, outdoor activity centres are sometimes owned by local authorities and made available to schools in that authority’s area and therefore receipts may be lower than could be achieved if the property was operated on a fully commercial basis. Care therefore needs to be taken in analysing accounts relating to these properties.

4.3 Where reliable rental evidence or full accounts are available these should be analysed in terms of gross receipts and single bed spaces to assist in forming local schemes of valuation for these classes.

4.4 For 2017 and earlier rating lists, where there was no reliable rental evidence or full accounts, valuers adopted a percentage of gross receipts to develop valuation schemes based on RV per bed space. For 2017 percentages adopted were as set out below:

Climbing Huts – 25-30% depending on the level of facilities provided.

Sleeping Barns – 20-25% depending on the level of facilities provided.

Hostels – 8-10% depending on the level of service and range of meals. Careful consideration needs to be given when looking at city centre accommodation and the interface with the budget hotel sector - in these cases the budget hotel scale may be relevant. (See RM Section 5a: Hotels (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-510-hotels))

Outdoor Activity Centres – 5-10% depending on the level of service, staffing required for activities/teaching, range of meals, and whether central costs are involved (larger organisations).

Religious Retreats/Study Centres (Residential) – Comparison may be made with hostels, but given the nature of the occupation of this class, a local tone based on floor space may need to be applied.

4.5 For the 2023 rating lists, the effects of the COVID-19 outbreak need to be taken into account as they would have been anticipated by the parties at the AVD. Trade evidence that includes long periods of lockdowns is unlikely to provide good evidence of the FMT at the AVD. Where properties are being valued directly on their receipts (e.g. the larger, commercially operated outdoor activity centres) valuers are advised to take as their starting point the closest reliable trade, which is likely to be the 2019/2020 trading year (ending March or before) and any previous trading years.

4.6 Having established the likely FMT for the 19/20 trading year (ending March or before), the valuer should then consider any further adjustments needed to reflect the receipts envisaged as at 1 April 2021. The reasonable efficient operator (REO) will take a view not only on the trade immediately achievable at AVD, but the trade over a period of time ahead, as they are assumed to be taking a tenancy with a reasonable prospect of continuance.

4.7 Most properties within these classes should however still be valued on schemes adopting a price per bed space. Valuation schemes should reflect the expected level of trade, as outlined at paragraph 4.6 above, and the level of risk and uncertainty experienced at the AVD.

4.8 Where there are large amounts of ancillary accommodation, e.g. in the largest activity centres, levels of value should fully reflect the accommodation present.

4.9 There are analysis and valuation scales within RSA specifically for hostels and these enable input of factual data to achieve valuations that follow the recommended approach. As set out in section 2 above, where the hostel is similar to a budget hotel it should be valued by reference to receipts using the LPA.

4.10 Outdoor activity centres and religious retreats should be valued on the Non-Bulk Server.

Practice Note: 2017 - hostels, outdoor activity centres and religious retreats

1. Market Appraisal

Modern hostels are becoming more of a hybrid product combining attributes of hotel service standards with a relaxed and friendly atmosphere - these are commonly known as “Poshtels” - however outside of the major cities more ‘traditional’ hostel accommodation still exists.

The hostel sector has experienced rapid growth fuelled by the economic downturn as demand for low cost rooms became greater and facilitated a change in the hostel market with the emergence of a new breed of hostel brands. The new style of hostel competes directly with the budget hotel sector, so much so that Premier Inn have created ‘The Hub’ concept and Tune Hotels are offering a similar hotel/hostel experience with cheap very basic and small rooms.

Current national operators include, YHA, St Christopher’s Inn’s, Meininger, Wombats, Plus Hostels, Generator, Safestay and Clink.

The market is split between the more modern hostel accommodation found in cities, mentioned above, and traditional YHA accommodation which can be found in rural locations, and are commonly used by schools or backpackers.

Hostels were excluded from Class C1 of the Use Classes Order in 1994 (by SI 1994/724) and are therefore sui generis. Religious Retreats are also treated as sui generis.

There is limited published data on hostels - however from the data available it is estimated that 10% of commercial hostel guests are now corporate, with 10% couples, 15% families, 30% single tourists and just 35% schools and youth groups.

In order for hostels to remain competitive in the budget accommodation sector keeping costs down is key - using sites such as Airbnb to advertise rather than Online Travel Agencies (OTA), however there are also hostel specific OTA’s that service the sector.

The UK hostel sector has been forecast to grow up to 3% between 2013-2018 with sales reaching an expected £216m in 2018 across an expected 653 hostels. It is anticipated that the focus will be primarily on bed sales, current food and beverage sales account for circa 15% of total revenue in traditional hostels, however, as hostel operators continue to advance their operations more emphasis on F&B may well be seen in certain locations.

Overall, hostels appear to be in a strong position, they remain the only form of ‘serviced dormitory’ available in a market which is increasingly price sensitive. The emergence of the more modern urban hostel and predicted growth in emphasis on food and beverage in city centre locations could increase popularity and market share.

Field Study and Activity Centres

These provide a range of activities to different market sectors, from team building days for businesses to school activity days, the centres can also provide residential accommodation facilities.

In recent years the market for activity centres has been affected by the economic climate, many are run by local authorities and many are used by local authority schools. Both have experienced funding cuts, this combined with more stringent health & safety requirements and increased insurance premiums, has had a negative impact on this sector.

Religious Retreats

There is limited published data available, but overall the indications are that there have not been any major changes in this class of property.

2. Changes From 2010 Practice Note

For the 2010 Revaluation these classes were valued using the Rating Support Application (RSA) except in certain cases (see below) when the Non-Bulk Server was used. The same approach should be adopted for 2017.

3. Valuation Scheme

What rental evidence is available tends to be unhelpful because of connections between parties, for example YHA and local authorities, or there has been significant work carried out to the buildings so that their value does not reflect the rent paid for the original property. Historically, identifying and obtaining costs of improvements have proven difficult.

As a result of many occupiers being charities or local authorities there will be occasions where hereditaments are not operated to their full commercial potential and care needs to be taken in analysing accounts relating to these properties.

Where reliable full accounts are available these should be analysed in terms of gross receipts and bed spaces (see paragraph 4 below) to assist in forming the local scheme of valuation for this class.

In the absence of reliable rental evidence or full accounts it is recommended that a percentage of gross receipts be adopted to assist in determining a valuation scheme based on RV per bedspace. Previous analysis suggests that the following percentages may be used:

Climbing Huts - 25-30% depending on the level of facilities provided.

Sleeping Barns - 20-25% depending on the level of facilities provided.

YHA and other hostels – 8 -10% depending on the level of service and range of meals. Careful consideration needs to be given when looking at city centre style ‘poshtel’ accommodation and the interface with the budget hotel sector - in these cases the budget hotel scale may be relevant. (See Rating Manual: section 6 part 3 - section 510 Hotels).

Outdoor Activity Centres – 5 -10% depending on the level of service, staffing required for activities/teaching, range of meals, central costs involved where larger organisations.

Religious Retreats/Study Centres (Residential) - Comparison may be made with hostels, but given the nature of the occupation of this class, a local tone based on floor space may need to be applied.

The analysed figures will need to be considered closely and a common sense approach adopted when considering levels of value to be adopted. As explained above, actual gross receipts may not be typical of the level which could be achieved if commercially operated (assuming an alternative type of operation can be envisaged without offending the principle of rebus sic stantibus). For example outdoor activity centres are often owned by local authorities and made available to schools in that authority’s area and therefore receipts may be lower than could be achieved if the property was operated on a fully commercial basis.

4. Valuation

It is recommended that the unit used for comparison and valuation is a single bed space. This is a berth for sleeping one person - a double bunk will be the equivalent of two bed spaces.

The valuer should always “value as you devalue”, so that where analysis is on a single bed space basis, reflecting normal ancillary accommodation, the valuation scheme should be on the same basis. Valuers should still reflect the extent and quality of the ancillary accommodation in the adopted valuations, as well as any additional or unusual rateable features.

Evidence of the number of bed spaces is often readily available in brochures. The YHA brochure for example gives the number of bed spaces as well as a pen picture of its hostels. Where information is not readily available it can be obtained by contacting the relevant hostel.

In view of the lack of rental evidence and doubts in respect of some of the accounts evidence for this class it is important for valuers to stand back and consider whether the proposed valuation is reasonable having regard to the type, quality and location of the property and the values of other physically similar hereditaments in the locality. Care should be taken to ensure valuations are not out of line with physically similar hereditaments used for other purposes.

Where there are large amounts of ancillary accommodation, e.g. in the largest of activity centres, it should be ensured that the levels of value adopted fully reflect the accommodation present.

There are analysis and valuation scales within RSA specifically for this class and these enable input of factual data to achieve valuations that follow the recommended approach. For the larger activity and field study centres where there is significant ancillary accommodation the facility to input valuations on the Non Bulk Server (NBS) is available. There is also provision in the NBS to cover religious retreats and study centres (residential).