Record-breaking heat waves, an uncertain forecast for Britain as we know it and the rise in availability and variety of homestays could all be contributing to the increase in the number of UK summer staycations being booked. Added to this tourists from overseas are capitalising on the currently weakening pound which has helped make the UK become a more appealing holiday destination, and so the Great British Holiday is now a more popular choice for all.
Homeowners looking to generate a second income could consider investing in a holiday let to turn a profit by renting it out to others - with the added bonus of being able to plan a get away themselves. Could managing a holiday let be right for you?
Getting started with holiday Let
There is a huge range of potential holiday lets on offer these days, but before you opt for a property, you should check its suitability. Location, facilities, and amenities are all important, as well as considering who the property will appeal to. If you can identify a target market, you can style your holiday let so that you’re more likely to be able to let your property out successfully.
Suss out what your holiday let landlord duties should be, such as health and safety regulations, and then consider the investment you’re about to make. The management, the marketing, and getting those bookings are essential to maximise return. We’ve called in the experts to put together some top tips for new holiday let owners.
You'll need a holiday let mortgage
If you’re buying a holiday let, you’ll need a specific holiday let mortgage designed to offer short-term lets. Holiday let mortgages aren’t as readily available as standard mortgages and it’s important to check the restrictions and criteria between providers to ensure the product is suitable.
There are tax benefits with holiday let mortgages. A furnished holiday let gives access to potentially valuable capital gains tax reliefs such as holdover relief, rollover relief, and entrepreneur’s relief - where other rental properties do not.
Holiday let income
In high-season, your holiday let property has the potential to make more in one weekend than a comparable buy-to-let property does in a month, however there’s no assured shorthold tenancy agreement to guarantee that income.
Advertising, managing bookings, and responding to enquiries can be a lot of work, and can be very time consuming so do your homework and consider specialist lettings agencies.
Do this right, and you’re well on your way to having a full holiday let, which means you should be able to make your mortgage repayments, and enjoy the fruits of your labour… and speaking of labour, don’t forget to factor in the cost of kitting out the property, maintaining it, and covering the utility bills.
At Ipswich Building Society we offer free mortgage advice through our team of professional, qualified mortgage consultants. Visit our holiday let mortgage product page to find out how we could help with your holiday let purchase or remortgage, or for a no-obligation chat about your circumstances or to see what we may be able to offer you, give us a call on 0330 123 0773.