Investment

merecat62

I am looking to retire next year and would like to know where best to invest £200k? I have thought about buying an apartment but is there anything else that would get me a better return? I am looking to buy an apartment near the sea in Cornwall to hopefully rent it out for 10 months of the year and for us to use it ourselves for 2 months of the year. One and two bed apartments range from around £800 to £1300 to rent but I’m unclear as to what agents charge to help market and clean the property. Does anyone know what agents charge, what the monthly profit is or whether there is a better solution to invest my money? 

dunstonh

I am looking to retire next year and would like to know where best to invest £200k?

That is a question with very many answers depending on your circumstances. There is no one-size-fits-all best option.

I have thought about buying an apartment but is there anything else that would get me a better return?

What is your experience with being a landlord? Why an apartment? (typically amongst the worst to suffer in negative property markets).

I am looking to buy an apartment near the sea in Cornwall to hopefully rent it out for 10 months of the year and for us to use it ourselves for 2 months of the year.

I take it you mean holiday lets rather than renting it out?  Nobody is likely to rent a place for 10 months of the year.

One and two bed apartments range from around £800 to £1300 to rent but I’m unclear as to what agents charge to help market and clean the property. 

Or perhaps you do mean rent.  However, what is the tenant going to do in the 2 months you want it?  What about all their belongings?

Stamp duty on the way in.  Income tax on the income and capital gains tax on the way out. No experience of being a landlord and the requirements it brings. Can you afford the frequent redecorating and refurbishment you will need to carry out? or the dead periods when a tenant fails to pay?

It is still possible to make money with property but its not the easy game it was over a decade ago.   It takes more knowledge and understanding today.  And it can help if you can do repairs, redecoration and building work yourself.

tacpot12

Letting agents for residential lettings charge about 13%. I don't know the Holiday Let market but expect it will be about the same.
 
Cleaning should not be too much as in a week or two of holidaying, properties can't get too trashed. I would budget for £70 to clean the property between lets. You do of course get rogue customers; many holiday lets don't allow stag dos and hen parties for this reason. There is quite a lot to running a holiday letting business, what with the tax, insurance, accounting, repairs, cleaning, marketing, etc. Letting agents and accountants can do some of this for you, but it all reduces your return.  

You might be better off investing the money on the stock markets and using the return to allow you to pick and choose where you go on holiday. Bear in mind that you will likely have to have the quiet months in the apartment when no one wants to rent the property as you can't afford to have it in high season because it is those weeks that cover all the fixed costs.