Holiday Let or Buy to Let?

by Readers Question

13:53 PM, 4th February 2018
About 3 years ago

Holiday Let or Buy to Let?

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Holiday Let or Buy to Let?

After many years of letting to ‘regular’ tenants, I’m now thinking about dabbling with holiday letting. I’ve just agreed to buy a modern mid-terrace house in a seaside town in Cornwall, and my own house is also by the sea, in Devon, and quite cute.

My plan was to rent out the house in Cornwall until such time as I wanted to move down there, but now think I’d like to let it to holiday makers, so I can use it myself out of peak season.

Then it occurred to me that perhaps I could rent out my own house (mortgage just about to be paid off) as a holiday let instead, and live in the house in Cornwall. I need to make a decision as I have to get a mortgage for the house in Cornwall, so either buy-to-let, or holiday let mortgage, and I believe that the related issues are very different too e.g. business rates instead of council tax.

Also, is it possible to manage a holiday let, whilst living elsewhere, or is it better to use an agent?

Any advice will be warmly welcomed.

Thank you

Tricia

Comments

Trish

18:09 PM, 8th February 2018
About 3 years ago

Reply to the comment left by Susan Bradley at 04/02/2018 - 17:56
Thanks, does the agent sort out the housekeeper, or is that something I should do separately myself?

Trish

18:14 PM, 8th February 2018
About 3 years ago

Reply to the comment left by Andrew Milner at 05/02/2018 - 11:03
Thanks, that's good to know. I've been trying to work out what letting agents do that I can't do myself - I guess if I get a good caretaker/cleaner and register with an online letting forum it might be doable then.

Trish

18:16 PM, 8th February 2018
About 3 years ago

Reply to the comment left by Luk Udav at 05/02/2018 - 13:35
Thanks for that. I sent for a brochure from 'Sykes' in the hope that it would tell me how much they charge, but there were some nice pictures but no real information. 24% sounds a bit steep!

Trish

18:17 PM, 8th February 2018
About 3 years ago

Reply to the comment left by zoe at 05/02/2018 - 23:21
Thanks, that's helpful. Am just making a list of everything I need to buy - reckon I'll be boosting Ikea's profits this year!

Trish

18:18 PM, 8th February 2018
About 3 years ago

Reply to the comment left by Luk Udav at 06/02/2018 - 10:58
That sounds like a good idea, on the basis that you get what you pay for. Do you pay by the hour, or for each turnover? How much would you suggest is the right amount?

Susan Bradley

20:14 PM, 8th February 2018
About 3 years ago

Reply to the comment left by Tricia Forrester at 08/02/2018 - 18:09
Hi Trish. In my case we were allocated a cleaner/s and then the housekeeper went round doing spot checks on all the houses on their books. They sorted cover when our cleaners were on holiday/ sick and if there were any complaints re cleanliness they would send them back to rectify them. Also sorted maintenance issues as well but if we had wanted to use our own cleaners that would have been allowed. We found the agents to be very keen to get our property on their books and were able to negotiate a lower fee. I think that’s why they don’t advertise their fee as some pay less than others so haggle! Although it costs more to have an agent they only earn money if they get bookings so they will work hard to get them so it offsets the extra cost to some degree. In the lakes we were able to get bookings all year round as people go there for the views not the weather! It can be very lucrative but expect to be wound up- you can get complaints about a blown lightbulb!

Trish

20:35 PM, 8th February 2018
About 3 years ago

Reply to the comment left by Susan Bradley at 08/02/2018 - 20:14
Thanks, that's useful to know. Gosh, its a lot more complicated than renting out to regular tenants, although I like the idea that I'll actually get paid, doing holiday lets! Have had a couple of awful tenants lately, one with impeccable references! I'm going round to visit a letting agent in the morning, so will have a go at haggling

Luk Udav

16:51 PM, 9th February 2018
About 3 years ago

Reply to the comment left by Tricia Forrester at 08/02/2018 - 20:35
If you get the cleaing/maintenance done through an agent then likely as not you'll get VAT added on - just another extra cost. My remark about 20%+VAT is founded on my house's locality - I've tried negotiating but they just won't move.
I pay per turnover, but the rate will surely depend on the size of the property etc etc (e.g. who provides the linen, who washes it) so I suspect any sum I give won't be all that helpful.
I used an agent the first year, and now do it myself. It's not much hassle since I got all the form letters written.

Trish

18:25 PM, 9th February 2018
About 3 years ago

Reply to the comment left by Luk Udav at 09/02/2018 - 16:51
Yes, VAT seems to be something that needs to be taken into account. I spoke to a local agent today who charges 18% with no VAT which was a nice surprise, but that doesn't seem to include much other than the actual letting out.

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