Owning a Holiday Cottage for InvestmentJanuary 4th 2013
Holiday Cottages can represent a brilliant investment opportunity as well as providing a second home for you and your family.
Over the last few years increasing numbers of people have chosen to holiday at home, Visit England forecasted a staggering 23% increase on holiday cottage bookings for 2012 than the number made in 2010. They also reported on the ever increasing rise of online bookings for such accommodation.
Although the property market has remained stagnant over the past few years an increasing number of people have seen investing in property as relatively low risk when compared with the stock market, because of this and due to the opportunity to earn a higher return than your average investment the purchase of holiday homes has increased over the last few years.
Rental values for holiday cottages are substantially more than those on buy to let properties and so assuming you can generate the bookings required the returns can also be much greater.
And as if all that wasn’t enough there are also some other very good tax reasons why purchasing a holiday home makes an attractive investment.
There are a few things to be mindful of when purchasing a holiday home. Primarily the location is key, you want to ensure that your property is let for as many weeks of the year as possible and so choosing a the right area where visitors are going to continue to come to on their holidays can make or break the investment. However the more desirable a location the more expensive it often is to purchase a property there. With this in mind you must ensure that your investment could weather a slump in the property price or an increase in interest rates.
To enable your property to generate the maximum revenue possible the property needs to be advertised effectively to ensure that it receives effective exposure to the right people.
Your also want to make sure that the property is well maintained and well thought out to ensure your customers are satisfied with their stay, this is becoming more and more important with the increasing popularity of customer review sites on the internet.
As the popularity of the “staycation” is increasing as too is the quality and range of accommodation being offered and so to ensure your property stands out and has a high occupancy rate you need to maintain it to a high standard and make it as appealing to the holidaymaker as possible. Little touches such as foody treats on guests arrival, well equipped kitchens and tourist information being provided can make a big difference to the holiday maker and your reviews.
If you wish to look into the investment opportunities further you should always seek professional independent financial advice.
By Lucy Purves