Holiday Home

Whether you’re buying a second property as a holiday let or changing an existing property into one, a holiday home can be a great investment. If you are thinking about buying a holiday home in the UK, there are quite a few things that you’ll need to consider.

The Location of Your Holiday Home

Location is everything. Situated in the right place, a holiday home in the UK can earn as much as three times more than a standard buy-to-let property.

If you’re thinking about buying a holiday home in the UK it will need to be located in a place that people will want to visit all times of the year, otherwise, you’ll need to generate enough income throughout the holiday season to cover the entire year. It should also be situated close to good transport links and easy for you to travel to, just in case there any issues with your guests.

Do your homework on the location. If you choose to buy a holiday home by the sea, by a lake or any other area of water you’ll want to check if there are any flooding risks. Check out the demand for holiday homes in the area, and look at the competition. You might even want to take a short break in the area yourself, that way you will get a good feel for whether it could make a good location for your investment.

The Condition of Your Holiday Home

One of the cheapest ways to raise rental income for a holiday home is to make sure that the property is well maintained. The condition of the property will directly affect the holiday rental value. Replace tired and outdated kitchens and bathrooms for maximum value.

Older properties often cost more to keep running. A country cottage, for example, may seem like an idyllic holiday home, but will it be easy to maintain? Thatched roofs need regular maintenance and upkeep to limit deterioration and are seen by insurance companies as an increased fire risk.

On the other hand, some of the most popular holiday places in the UK are beginning to restrict the sale of new build properties as second homes, so you’ll need to thoroughly research the law locally.

Holiday Home Costs Can be High

For a holiday home mortgage, you may need to visit a specialist mortgage lender. Many mortgage providers see holiday homes as high risk due to the seasonality of the rental income. Stamp Duty fees are also higher for a second property. Once you start to rent out your holiday home, the first £1,000 of rental income is tax-free. After that, you will be liable to pay tax on any income received for your second home.

Running costs can also be high. If you are using a letting agent, a grounds maintenance company and a cleaner you’ll also need to factor in the fees for these. Holiday homes are typically also furnished and guests will expect the use of all amenities. Towels and bedsheets will also need replacing regularly.

Holiday Home Insurance

Holiday Home Insurance can be confusing. Holiday homes in the UK can vary greatly so you might be wondering exactly what type of insurance cover you need. At Ashburnham Insurance we understand the risks involved with holiday homes. Holiday home insurance covers you for any rental activity, as well as provide you with second home insurance in between periods of paying guests or while you are staying there yourself. We can continue this cover for the gaps in between rental periods, such as when the property is empty between occupants or vacant during the winter months.

To find out more CALL Ashburnham Insurance for FREE ON 0800 1696137.

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