Running a holiday cottage: do finances stack up?
Voyager2002
Posts: 15,278 Forumite
Just wondering if this kind of business would give a sensible return on an investment of more than 200,000. The property in question is close to a beach and a designated "area of outstanding natural beauty"; has one large bedroom and comes with a field that could be used for camping.
Could anyone please point to some online resources that would indicate how this might work as a business? Or of course post about relevant ideas and experiences.
Could anyone please point to some online resources that would indicate how this might work as a business? Or of course post about relevant ideas and experiences.
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Comments
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Everything you could possibly want to know (and more that you didn't) about the holiday cottage business can be found here: https://www.laymyhat.com. Especially the forum.
It sounds lovely.
EJ0 -
Check out the realism of a 'potential camping site', speak to local planner first.
You would have to manage the camping site in person? so do you live close?
Check out agents fees for the holiday let as they can rack up considerably, who would do the cleaning and recirculating bedding/towels etc (and what would that cost you)
Need to factor in declaring income thus income tax etcDebt is a symptom, solve the problem.0 -
I'd worry about a one bedroom house. Whenever we look, there's a glut of one bedroomed flats/houses for holiday lets, yet a shortage of 3 bedroom ones. I'd suggest you search your proposed area to see how many there are already and you can usually see their online booking calendar to see how well booked up there are.0
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I'd worry about a one bedroom house. Whenever we look, there's a glut of one bedroomed flats/houses for holiday lets, yet a shortage of 3 bedroom ones. I'd suggest you search your proposed area to see how many there are already and you can usually see their online booking calendar to see how well booked up there are.
That was what i was about to post - a one bedroom cottage would be quite limited in its appeal0 -
That was what i was about to post - a one bedroom cottage would be quite limited in its appeal
Not so. Finding a house/flat for a couple as opposed to a family is a nightmare.
I've just spent a couple of weeks looking for a one bed flat for me and my wife, rather than paying for an extra room I'm not going to use.0 -
Not so. Finding a house/flat for a couple as opposed to a family is a nightmare.
I've just spent a couple of weeks looking for a one bed flat for me and my wife, rather than paying for an extra room I'm not going to use.
Good point - OP, if you are looking to invest over £200k then why limit the amount you can charge by having a 1 bedroom place when you might potentially get somewhere with more bedrooms for the same price, or thereabouts.
Do some more research, are the 1 bedroom places in the area booked up, compare those to the 2, 3 etc bed places and see what the demand is like, prices charged vs the cost of buying a similar place.Make £2018 in 2018 Challenge - Total to date £2,1080 -
Not so. Finding a house/flat for a couple as opposed to a family is a nightmare.
I've just spent a couple of weeks looking for a one bed flat for me and my wife, rather than paying for an extra room I'm not going to use.
You're looking at it subjectively, not objectively.
What percentage of the market are looking only for one beds only?
Lets say 25% - why restrict your market appeal by 75%?
PLUS you're saying you've the expectation it will be cheaper, so not only are you restricting your market with a one bed, you're getting less rental income.0 -
You're looking at it subjectively, not objectively.
What percentage of the market are looking only for one beds only?
Lets say 25% - why restrict your market appeal by 75%?
PLUS you're saying you've the expectation it will be cheaper, so not only are you restricting your market with a one bed, you're getting less rental income.
By the same token, what if 75% of the market is looking for one bed? Its not written in stone that familes are the largest area of the market.0 -
all one can say is generalisations since "we" have not researched OP's specific property in the context of its specific geographical market.By the same token, what if 75% of the market is looking for one bed? Its not written in stone that familes are the largest area of the market.
- there are a very wide range of markets
- there are businesses operating in all those markets
- some business specialise in only one market,
- some business cover more than one market from the same premises
- all businesses compete, either against those already in that niche or across more than one niche by, for example, having a single couple rate for a 2 bed property. That may or may not be more expensive that a single couple rate for a 1 bed.
pick a strata of the market, research who your customers will be and who your competitors will be.
is no where near enough info to provide anything other than vague generalisation200,000. The property in question is close to a beach and a designated "area of outstanding natural beauty"; has one large bedroom and comes with a field that could be used for camping.0 -
is no where near enough info to provide anything other than vague generalisation
Absolutely. And then we come to the next factor of whether to accept dogs or not, where opinions are polarised yet again, with some people saying they get more business by allowing dogs and others saying they get more by being dog-free. The OP has a lot of research to do to check out their local competition and also look at the market as a whole to see what kinds of occupancy levels are achieved by each different factor.0
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