Buying a holiday home in the UK is indeed one of the most exciting things you’re ever likely to do. Something you will probably have been dreaming about for quite awhile. If you are one of those about to take the plunge and turn the dream into reality, then this article is definitely worth a read before you go out and start signing cheques. It can certainly be a bit difficult to restrain unbridled enthusiasm when dealing with dreams, but there are a few caveats you ought to be aware of, and we believe the information we’ve given here will prove helpful in turning the reality back into a dream! Take a little time now, avoid some pitfalls later on, and hopefully you’ll still have the feel good factor several years down the line.
Where to buy my Holiday Home Well, you’ll know where. It will usually be governed by a burning desire to be in a specific part of the UK, and nothing’s going to change that. Do bear in mind that ease of access does impact on your ability to sell holidays and short breaks – especially out of season; if letting income is critical to you, this may be a governing factor. Good road links to the motorway network, and to centres of population ought to be a serious consideration. Also, do a bit of local research – ask locals, the village publican and shop owner, about business during the quieter months. In fact go yourselves if you can, perhaps in the depths of winter; forewarned is forearmed, and if you still love the place you’re probably on the right track.
Why buy a Holiday Home Again, you’ll know exactly why you want a holiday home. And again it will almost certainly be for very personal reasons. Just make sure they are the right reasons, and that they will remain unchanged even after the initial euphoria starts to calm down a little. Remember that return on capital only rarely converts into an attractive income, although as a longer-term investment, the returns, if you ever come to sell can turn a holiday home into a fabulous home for your money as well. If you are to truly enjoy your holiday home make sure the financial criteria are clear in your mind, but don’t treat them as the top priority.
Holiday Home Location We all know the old cliches about location. We still hear them because they really are the most important factors governing values and saleability. Make sure you buy the best location you can afford. Pick your estate agents brains – their local knowledge can prove invaluable. If you are buying in a coastal location get as close to the water as you can; waterfront cottages are always in demand, whereas those even one row back can sometimes struggle however well presented they may be. The same goes for the upmarket end of the street. Proximity to local amenities is always important – the village pub, shop and restaurant are high on the list, a garage or good parking facilities are pretty much essential, and reasonable access to one or two tourist attractions can be very helpful. The same can apply to such amenities as golf, riding, and a larger town with shops for the ladies. There are some obvious points too, when looking at the countryside and farm property market: Picturesque, a degree of seclusion, and not too much noise or smell are all-important factors. A farm cottage right by the dairy may be OK for you, but a lot of holidaymakers might just hate it for the very reasons you love it. Be careful, and try to exchange shoes with your prospective clientele during the selection process.
How often will I want to visit my Holiday Home? If you are going to let the property yourself remember that all the school holidays, bank holidays, and the festive season attract premium rental values. You will need to balance income criteria with that of family use. Make a plan, and write it down – it will crystallise matters, and that’s what you need right now – not just an idea in your head that might change when you have taken bookings and it’s too late. If you decide to use an agency remember that it will almost certainly place some constraints on the weeks left available to you as owners.
SIZE You’ll obviously look for somewhere to fit in with your own needs as the first priority. Then take a good look at the local housing stock, and try to get a few brochures to see if there is a niche in the market that isn’t fully catered for, and be flexible – for instance, a property capable of division can work well; let one side, and use the other, or let it as 2 units, let all of it to bigger party groups, or use it all when the need arises. Our personal experience showed that well presented 2 bedroomed properties in prime positions are generally the ones most in demand. However, larger properties are also in great demand for peak periods, though more difficult to fill at other times.
Internal Amenities The general rule is the more you provide the better the guests will like it, and it goes without saying that the better your holiday home is equipped and presented, the higher the rent will be that you can command, and the higher the number of returning guests will be. Demand will generally be more buoyant, and your property, particularly if it is in a small community will soon gather a personal reputation. A decent quality oven and hob are obviously essential, even if you have an Aga in the kitchen. We know Aga owners all swear by them, but non users can quite often feel a bit intimidated. You ought to have a microwave, a fridge and freezer of generous proportions and a dishwasher wherever possible – holidaymakers hate washing up. A lot of them hate cooking as well, but stretch to it when pushed – they always want decent clean equipment to do it on. Include a washing machine and tumble drier – discerning guests might put up with the vagaries of our changeable climate, but really appreciate a drier if they get soaked. Try to provide a shower, even if it’s over the bathtub. Make sure there is generous provision for both heating the house, and for the supply of piping hot water. We hate to mention television, but you have to have at least one with a reasonable size screen, and if it’s a family size house a video or dvd player will definitely be appreciated. Luxuries like saunas for example should only be considered for your own comfort, but know where to draw the line for the public who generally don’t look for that sort of feature.
Holiday Home PresentationIt has to be said, that an awful lot of holidaymakers, particularly those who have had a long drive can arrive tired and a bit grumpy!! “Arrival syndrome” we used to call it, and the right first impression will help you avoid early holiday flack, and to bank a whole load of goodwill for use later on. This initial feelgood factor will help enormously if anything goes wrong during the rest of the holiday. You will find it also goes a long way to cementing relationships that might, with a little effort last for many years, so don’t stint in this department. A bottle of wine, or homemade cake, bunch of flowers, a welcome pack that includes milk, tea and biscuits and some local produce will make a world of difference, and best of all is a personal welcome. This is something you ought to make part of your housekeeper’s role if you are an absentee landlord. An open fire can frequently sell a week or two in the close season, when the word “cosy,” really comes into it’s own (remember to have the chimney swept regularly), and try to persuade your caretaker to light it for the new arrivals. Don’t forget to provide basic cleaning materials, a new loo roll, some spare light bulbs, and a “house file,” that details local tourist attractions, local pubs, shops, restaurants etc., and also contains appliance manuals together with a personal welcome message. It’s absolutely essential to have your caretaker / housekeeper’s contact numbers clearly visible.
External AmenitiesCapitalise on your outside space. Make certain you employ a reliable gardener and window cleaner, and spend some time each year on external decorations. If you’re lucky enough to have a view, make sure it’s unobstructed, and position your garden furniture (yes it is essential) and hopefully a BBQ in a spot that takes advantage of it. Make sure your parking place is clearly marked.
Holiday Home management & maintenance Never ever underestimate the importance of maintaining a holiday home in A1 condition. Your clientele look forward, as you do yourself, to their holiday; it’s a very important part of their year, and they expect to get exactly what you have told them they will be getting. Believe me, they are never slow to let you know if something isn’t exactly to their liking. If you are to let successfully without an agency, and you live elsewhere, then a local housekeeper is another absolute essential. The best solution of all is a couple – making the wife responsible for changeovers and cleanliness etc., whilst the husband acts as handyman cum gardener. These two can make or break, so choose wisely, pay them properly, and treat them with respect. They must be prepared to have their names and contact details displayed visibly in the house, and have a list of tradesmen available upon whom they can call at short notice. Their responsibilities are pretty much all encompassing and will include all or some of the following: gardening, linen, cleaning, running repairs, key holding, and close season security.
LegalStuff I guess the first consideration will be holiday home insurance, if for no other reason than that you have to hold cover from exchange of contracts. In addition to the usual buildings and contents cover you have to take out liability cover, and remember to mention the possibility of longer periods of inoccupancy. If you have a buy to let mortgage, no doubt the mortgagee will have pointed you in the right direction. If not, look for a broker or company that offers a comprehensive specialist package. There's a link at the bottom of this page if you are stuck, and we are sure you will be pleased with the quotes. You ought to consider appliance and utility services cover, particularly if you are not terribly well connected with local tradesmen - If an emergency occurs, and most owners are faced with the occasional trauma, it's an enormous relief to have help available at the end of the phone. If however, you have a good plumber, electrician, and jobbing builder that you or your housekeeper can call upon at short notice, and be certain of a response, then this sort of cover is less of an essential. You are obliged to have a landlord's certificate for the gas and electrical installation and appliances - you'll find qualified tradesmen in all areas. Fire regulations have become an important consideration when furnishing and letting your holiday home. Never buy second-hand soft furnishings, and before you let for the first time make sure any inherited items are up to standard. Trading Standards publish a guide. Make sure you have one, and take it with you when you go shopping. Also be sure to acquaint yourself with the regulations relating to fire precautions, and alarms. EPC's (Energy Performance Certificates) are now mandatory for residential and long term holiday lets (that's over 3 months), but apparently not for short term holiday lets, but there does appear to be some ambivalence, so the advice has to be check with the Local Authority before your first let. Tax, though unmentionable must be considered. The changes proposed prior to the announcement of the General Election on 6th May 2010 have subsequently been cancelled. However, the changes were designed to take account of EU law, and would have applied to holiday lets in the UK, and seemed to have meant that existing tax breaks would be lost. Whilst some repairs and maintainence may have continued to be allowable, most of your contents, furniture, and running costs etc etc., would no longer have been chargeable against tax. To keep up to date it is essential that you obtain further advice, and be sure to check with the Revenue. On the upside, it would appear that the previous rules regarding how long properties are let, and how long they are made available to let would have vanished. If you have an accountant discuss implications with him, and remember to talk about VAT if you are a registered trader. If you are resident abroad, and use an Agency, the agent is obliged to account for income tax, unless you are eligible for exemption - in either case the Revenue will need to be aware. Finally, you should be conversant with the provisions of the Equality Act 2007 (Sexual Orientation). :
Holiday Home Rules, Terms and Booking Conditions It’s your holiday home, so you make the rules. If you don’t want pets, or smokers, or even children for that matter, then say so. All owners have their own ideas about conditions to be imposed, and you will be no exception. It is important to avoid ambivalence in this business, but as long as you make the conditions crystal clear before accepting a deposit, and stick to them even if it means missing a booking, life will be much easier in the long run. You need to think about such things as the changeover day, arrival and departure times, security / cleaning deposits, any in house phone, arranging access (keys), and essentially set a maximum capacity – overcrowding should be prohibited under any circumstance, and would probably invalidate insurance cover. If you are wondering how to set your holiday home rent, the best path is again to gather local knowledge; you’ll probably have some already having stayed locally on numerous occasions. Do take time to study the competition, and gather in both Agency brochures, and even get an Agency appraisal. Remember to request tariffs from other private operators to compare figures, and set your first seasons prices a little lower than your competitors. Study the small print in the brochures, and if you are really really pedantic get your solicitor’s advice, but this is taking things to the extreme. Cancellation insurance is something else you will come across; everyone in the industry has some experience of lost bookings, cancellations and no shows. These incidents can occasionally cost more than expected – either landlord or tenant can be affected, and whatever the circumstance some degree of disappointment will be unavoidable. Always encourage clients to take cover!! It can be done easily via this site, and in the event of a late legitimate cancellation nobody looses out. Even if the cancellation is not so late, but within a defined time limit the same applies.
Grading your Holiday Home Think carefully before turning the proverbial nose up to grading, particularly if you are at the top end of the market. Grading your holiday home costs money, you have to have someone in attendance at a time to suit the inspector, and you have to meet a rigorous set of criteria in order to get a result that may be clouded by personal perception. However, it does add prestige to your advertising, and it does represent a guarantee of the standard of accommodation on offer. It is being increasingly being looked for by the holidaymaking public, and the European market has long looked on it as a good sign of reliability. So if you intend to forge links with our neighbours across the channel, or further afield, and this can be both lucrative and enjoyable, then grading is certainly worthy of consideration.
The money bit We’ve already suggested that return on capital can be disappointing, but that capital growth has historically proved excallent as a long term investment. By now you will also have realised that there is quite a bit of financial commitment required before the rents start pouring (or even trickling) in. One of our strongest pieces of advice, is that you sit down and write out a forecast, particularly if the financial aspects of all this is an important consideration. Forecasting income isn’t too difficult. With a little effort and promotional activity you should be able to let your holiday home for around 15 weeks in your first year. All the high season weeks: school holidays, half terms, the festive season, and bank holidays should add up to 9 or 10, and another 5 or so in the shoulder seasons in not an unreasonable expectation. Holiday home outgoings can be somewhat more variable. Regular charges will include all the usual household expenditure: council tax, utilities (some owners still charge extra for electricity – not a good idea), phone, insurance, and telephone; then add on estimates for housekeeping, caretaking, maintenance, window cleaning, laundering linen, welcome packs, marketing, and renewals. Then add on a figure of say 10% for contingencies. Take b from a, and you might get somewhere close to an answer. One thing – never never ever underestimate costs, or you will almost certainly be caught out. If, after balanced consideration this all seems just a bit too daunting, and you really are genuinely overfaced, the solution may be to take the Agency route. After all doing the job yourself doesn’t suit everyone. You may lead a busy life already, or you may just not fancy all the involvement. Look carefully at both sides of the coin before taking the plunge. Your holiday home should always be great fun, probably challenging at times, and hopefully very rewarding, and not just financially. Hopefully, we will have made you aware of some of the pitfalls, and also hopefully, you’ll still be quite determined to give it a whirl on your own. If you are, we’re sure you’ll be OK. We wish you luck, and look forward to seeing your UK holiday home advertised here very soon.