The housing market has boomed over the last six months, with people looking to get away from the stresses of their commute or relocating to search for new opportunities.
With a reduction in stamp duty and an exceptionally competitive market, people buying to take holiday lettings is becoming a popular option, particularly as travel corridors and the current circumstances change over the next year.
With that said, particularly with the nature of the housing market, there is plenty to consider before you buy a property to let. Here are our top tips to make the most of it.
Before you start investing, make sure you are sure that your income will help you make your money back and cover any outgoings.
Letting is a business, and as such you will need to consider costs beyond the mortgage itself. Accountancy, legal advice, property valuation, VAT, cleaners, repairs, utility bills and the insurance costs will add up.
Make sure you are ready in case of a contingency, either with disposable alternative monthly income or savings in case business slows down.
Your Local Market
Look into the market you plan on moving in to. You will ideally want a market that is popular enough for business holidays, staycations, walking holidays and honeymoons, but not one that is oversaturated.
Consider what landmarks, facilities and local shops are nearby as well, as these make for fantastic bullet points and marketing material. Consider how many holiday and let descriptions talk about the time to the nearest shop or major town.
As well as this, look into any competition you would have and see how you would stand out and grab someone’s attention. The price points are also important to look at when considering your costs above as well.
Check The Law
When getting into holiday letting, there are several laws you need to keep in mind, to ensure that you have no issues later on once your business has started up.
Planning permission is the main one for this, would the property you are looking at need specific planning permission to convert into the holiday home you want? If you are in any doubt whatsoever contact the local authority before you buy as this can cause major issues.
This can also work in reverse; if a property cannot be lived in and can only be used as a holiday home, some mortgage providers may be wary to lend, as it limits the number of buyers to other property investors rather than the wider market.
There are some tax considerations, such as ensuring your home counts as a furnished holiday letting. It needs to be fully furnished, with no restrictions on how visitors use the furniture. It must also be available for at least 210 days per year and be actually let for 105 days.
Making sure you consider before you start means that you will be able to reap the benefits of sooner.
Starting to consider whether letting is for you now means you can pick the right property and get it ready in time for the start of next year's holiday season.