The caravan site licence explained

The caravan site licence is the permission that lets a holiday park operate, and it is one of the most important documents on any park. Issued by the local authority and running alongside the planning permission, it sets the conditions a park must meet and controls how many caravans the site can hold, of what type, where, and for what use. Because the licence governs what a park can earn and whether it can grow, it is central to valuing, financing and running a park, and to any purchase.

This guide explains how the site licence works alongside planning, what its conditions control, the holiday-use and season-length restrictions it imposes, and why it matters so much to a park's value and finance. We arrange holiday park finance as a broker and introducer, not a lender. This is general information only; licences and their conditions vary and are administered locally, so always confirm the position for a specific park with the relevant council.

How the site licence works with planning

A holiday park needs two distinct permissions that work together: planning permission and a caravan site licence. The planning permission establishes the principle of using the land as a caravan or holiday park and usually sets the broad parameters, such as the number of units and the type of use. The site licence, issued by the local authority once planning is in place, sets the detailed operating conditions the park must comply with day to day. You cannot lawfully operate a site licence in a way the planning permission does not allow, so the two have to be read together.

This relationship matters when assessing a park, because a discrepancy between what the licence appears to allow and what the planning actually permits is a real risk. A licence might list a number of pitches, but the binding constraint is what the planning consent permits and any conditions attached to it. When buying a park, the licence, the planning permission and any planning conditions should all be examined together, with a solicitor, so the true permitted position is clear. Our park licensing and rules guide sets the licence in the wider context of planning, tenure and tax.

What the licence conditions control

The site licence attaches conditions that control the practical operation of the park. These typically cover the maximum number of caravans, their type, and the siting and spacing of units, which exists partly for fire safety, distances between caravans and from boundaries, the provision and maintenance of roads, footpaths and lighting, fire precautions and equipment, electrical and other services, and the general amenity and upkeep of the site. The conditions can be detailed and a park must comply with them, so understanding them is part of running the site lawfully.

These conditions also shape the park's capacity and therefore its income. The maximum number and siting of units caps how many pitches the park can let or sell, so a park near its licensed capacity has limited growth without a variation, while one with headroom has development potential. Bringing a park into full compliance, if conditions have slipped, can carry cost, which is a due-diligence point on a purchase. The licence conditions are not a formality; they define what the park is permitted to be, which is exactly what a buyer and a lender are valuing.

Holiday use and season-length restrictions

Two restrictions in the licence and planning have the biggest effect on income. The first is the permitted use. A holiday site licence restricts the caravans to holiday use, meaning they cannot be occupied as anyone's sole or main residence, which keeps the park a holiday business rather than a residential one. Enforcing this is part of the operator's responsibility, and a park found to have residents in breach of a holiday condition faces a real problem, so the use condition is something to verify carefully.

The second is the open season. Many holiday parks are permitted to operate only for a defined season, often closing for part of the winter, with the exact period set by the planning condition. The season length directly limits the income, because a park closed for several months earns less than one with twelve-month holiday occupation. A longer or year-round holiday season is therefore a material advantage, and extending a season requires a planning change that is not guaranteed. When assessing a park, the permitted season is one of the first figures to establish, because it caps the achievable earnings.

Why the licence matters for value and finance

The site licence sits at the heart of a park's value and fundability. Because the licence and planning control the number of units, the use and the season, they set the ceiling on what the park can earn, and earnings are what a park is valued and lent against. A park with a long season, headroom to add pitches and clean, well-documented consents is a stronger, more valuable and more financeable asset than one that is built out, closed half the year, or carrying compliance issues, even if their current accounts look similar.

For a lender, the licence is part of the security assessment. A clear, compliant licence with a long permitted season supports stronger terms, while a restrictive or problematic licence prompts caution. When we arrange park finance, we present the licence position, the permitted use and the season clearly, because a park whose consents are evidently in order is far easier to fund well. We arrange the finance as a broker and introducer, but confirming the licence and planning position is the buyer's responsibility, to be checked with the council and a solicitor before committing. Our how to buy a holiday park guide places the licence check within the wider purchase process.