buying a holiday let

molit

Hi

I am thinking about getting into the holiday let market, and buying a place on a specialist site, yet to be identified. I want to do my research on this, and was wondering if there were any recommendations in terms of decent websites/books that provide good information, especially in terms of management, advertising, tax liabilities, and financing

Cheers

M

Werdnal

Try here for starters:

http://www.laymyhat.com/forum/index.php?sid=c300ec371dbf3a3834f814e8c94a8705

Tax - see HMRC website

If you are on a site, this will have its own charges and restrictions, ground rent, maintenance, service charge, insurance etc, so check this out thoroughly before you commit to anything. If its a mobile home/cabin type property, it will have a limited lifespan, after which you will have to remove it or replace with a new one at your expense - site owners do not want to lower the tone of the place having dated units in place.

You need to ensure you have public liability insurance, building and contents insurance specific for holiday letting, you may need to change from Council tax to business rates. You need to adhere to stick fire safety regs and provide PAT tested electrical appliances and ensure all furnishings are up to current fire safety regs.

TV license and utilities will be your to pay, unless of course you install a coin meter, which seems to be a little frowned on these days. Bed linen, towels etc are generally expected. You will need to be available for change-overs or pay someone else to do them. You also need to be prepared for the unexpected - you have guests booked in from 2pm and at 11am you discover the TV is not working, so you spend a frantic 2 hours dashing around to get a replacement!

It is not easy money - TBH residential letting is a lot less hassle and expense and somewhat more regular rental income. I have just started out in holiday letting since Apriland to date only had 1 booking this year! People do not have as much money for holidays as in the past, fuel costs and the weather also have an impact. I had no choice, as my former residential flat has flooded twice over the last 2 winters, so I have to leave it empty from Oct-March, and only let it through the summer!

Why holiday and not residential for you?

molit

thanks for the response. I already have a couple of residential properties, and was considering options in housing, another BTL, a holiday let, or something else.

The initial price of the holiday lets seemed good, but the running costs are high I guess

Werdnal

molit wrote: »

thanks for the response. I already have a couple of residential properties, and was considering options in housing, another BTL, a holiday let, or something else.

The initial price of the holiday lets seemed good, but the running costs are high I guess

Definately higher running costs, which versus the higher rental tariff has advantages - IF you can secure regular bookings. I used to get around £4K a year (£400 a month) from my resi flat, but now my outlay has increased, and income is virtually nothing this year!

All the things the tenant pays for (utilities, CT, TV license etc) are also your liability.

If you need a mortgage to buy, check whether they will allow holiday letting, because it is classed as commercial and some may prohibit.

I am only planning to run as a holiday let for a couple of years, to add some "provenance" to the property, so I can sell on with proof of holiday letting potential. The flooding issue has knocked the value so much, it will be difficult to sell as a residential property, so trying to re-invent it a bit, and having to help my last tenant to salvage his "life" from a flood 2 days before Christmas, I cannot face going through that again ...