What Type of Property Makes the Best Holiday Let?

With the traditional Buy to Let market having become beleaguered by more aggressive tax legislation, many investors have turned their attention to the Holiday Letting market as the smart place to put your extra pennies. Not only will you benefit from more favourable tax arrangements but the growing UK holiday market also makes income generation potential much more realisable. If you’ve made the decision to look into a holiday let as an investment property the next step is to consider the location and type of property you might want to opt for.

Residential or Resort?

Many people considering entering the buy to holiday let market will be thinking of a traditional bricks and mortar property within the residential property market. However, it is well worth considering a purchase on a holiday resort and considering alternative accommodation options such as static caravans or luxury holiday lodges. A resort-based property will have the benefit of providing additional facilities which will be attractive to potential guests and attract guests year-round. A resort is also likely to have an existing sublet scheme which will offer a service to administer and manage your holiday letting business on your behalf, saving you lots of time and effort.

Family at Newquay View Resort
Location Boosts Bookings

In terms of location, you need to consider an area with an already buoyant holiday market in order to be sure of maximising the occupancy of your holiday rental. It is also good to consider how seasonal the tourist traffic is likely to be, so that you can predict how much of the year you can expect to see bookings. Coastal populations are hugely popular tourist destinations that have a thriving summer season; but you will need to look for an area which has plenty to offer outside of the main six-week season to really maximise your earnings. Cornwall is a case in point as it has extended its holiday season through the presence of major tourist attractions including the Eden Project and Lost Gardens of Heligan and culinary offers from headline hitting chefs including Rick Stein, Nathan Outlaw and Paul Ainsworth.

Avoid Inflated Prices

Choosing popular holiday destinations can cause the would-be holiday letter a few issues though, as their desirability pushes the market price of residential properties sky high, making it more difficult to see a return upon your investment. The purchase of residential properties for holiday letting is also a contentious issue in popular holiday destinations with locations such as St.Ives in Cornwall using Neighbourhood plans to crack down on the loss of housing stock to second homes. Resort based properties and in particular static caravans and holiday lodges avoid these problems as you will not be taking up valuable housing stock and they come with a much more affordable price tag too, so a return on your investment could be achieved much sooner.

Save Money on Fees

Many investors are looking to purchase their holiday let with a mortgage but Buy to Holiday Let mortgages can be much more stringent in their conditions, pushing up prices even further. The Government is also currently reviewing existing loopholes which allow second home owners to avoid the payment of council tax and receive business rate relief but are still keen to ensure that genuine holiday let businesses can still enjoy these redemptions. Consequently, owners of second residential properties in popular holiday destinations can likely expect more difficulty in avoiding council tax charges in the coming future. With the purchase of a static caravan or luxury holiday lodge you can avoid council tax, stamp duty, mortgages and solicitor’s fees altogether as they don’t apply to this type of purchase. 

St. Ives
Ready to Let and Cheap to Upkeep!

Another benefit of a static caravan over a residential property is that they are ready to start letting as soon as you have completed the sale. With a residential purchase you often need to complete some improvement works, redecorate or purchase furniture to make the property suitable for holiday letting whereas resort-based properties and particularly static holiday caravans are fully furnished, to a very high spec and ready to go. Ongoing maintenance costs and upkeep are also likely to be considerably cheaper.

Unrestricted Stays

Holiday Parks and resorts are no longer confined to a shorter rental season and it is possible to find holiday parks that are open for the whole year. All three of Peter Bull Resorts’ three parks are open for a full 12 month season and so attract visitors all year round. The residential specification insulation, double glazing and central heating which is now fitted as standard to brand new holiday homes also mean that they are as comfortable as a residential property, even in mid-winter.

Atlas Debonair
What Next?

If you are in the market for an investment property, it is definitely worthwhile considering properties located on resorts and taking a look at some sited static caravans or lodges. To arrange a visit to one of our three holiday parks complete the form below or give us a call on 01208 852000

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