Anybody own a holiday let?

[Doug71]

Just looking at ideas for the future as my knees, shoulders and elbows can't keep up this joinery thing for much longer.

My ex and I still own the house I currently live in (never got divorced, it's all too complicated!) and we think it would make a great holiday let, it's 4 bedroom, full of character and in a nice village about 12 miles from York. I'm amazed how much places around here charge per night, I know you have to furnish the place, pay the bills and the agency want a fair cut etc but it still looks tempting.

Does anyone have any real life experience of holiday lets who might want to quash the idea before I take it any further? I have been involved with residential lets most of my life so I would be going into it with my eyes wide open.

Thanks in advance.

Doug

 

[Sachakins]

Will you be local to it, for the cleaning, linen changes, repairs, resolving issues, etc?

 

[owen]

I did, it was great just after covid restrictions were lifted but last year wasn't brilliant. I've changed to letting it as a furnished property instead. Unless you can do the cleaning/changeovers yourself it wasn't worth it for me.
Mine was a 2 bed cottage in the Peak District, cost me nearly £100 a changeover in laundry, cleaners and welcome pack.
The prices you see on say Sykes website are nowhere near as nice once they have taken their commission.
Only way I would go back to it was if my situation changed and I could do changeovers myself.

 

[RobinBHM]

Just looking at ideas for the future as my knees, shoulders and elbows can't keep up this joinery thing for much longer.

My ex and I still own the house I currently live in (never got divorced, it's all too complicated!) and we think it would make a great holiday let, it's 4 bedroom, full of character and in a nice village about 12 miles from York. I'm amazed how much places around here charge per night, I know you have to furnish the place, pay the bills and the agency want a fair cut etc but it still looks tempting.

Does anyone have any real life experience of holiday lets who might want to quash the idea before I take it any further? I have been involved with residential lets most of my life so I would be going into it with my eyes wide open.

Thanks in advance.

Doug

As a dog owner, I like to take my dog on holiday so stay in holiday let’s every year.

Many of the owners are single cottage owners, they all seem to like doing it.

The fees are quite high: 20% for the company that have your property on their website and the booking management. Another 20% if you want the cleaning, laundry, welcome pack etc done. So fully managed it’s 40%

My guess is your property would fetch roughly between £1200 to £1800 per wk allowing for high / low season.

Bear in mind high season is all school holidays: ie 6 weeks of summer, 1 week spring, 1 week autumn half terms.


I often stay in a cottage in Suffolk called Buttercup lodge, it’s a converted cow barn. It’s around £1000 a week.
I’ve noticed it’s not been terribly booked up last 2 seasons - it’s a little bit further to the main coastal towns so I think location is a massive driver for occupancy rates.

I would start by researching cottages for let close to where your house is and see what the prices are likely to be, if you try entering dates to booking most sites will show how booked up the properties are, so that would give you a clue on how popular your area is.

Obviously net income is gross letting price, less fees then adjusted for occupancy rates.

I think high heating costs has impacted the income recently - especially those cottages that get let out over Christmas and winter periods




Airbnb might be an option, they are becoming popular for traditional self catering cottage lets.

 

[Jameshow]

I think the market has turned since COVID and many people are going back to foreign holidays.
On our small lodge site in north Devon there must 6 on the market ATM which is unheard of...
Sykes take 20%
Cleaners £120 (which in winter can be half your takings)

So I would suggest you use Abnb or market it yourself and do the cleaning yourself otherwise you won't make much.

 

[mccpe]

Just been looking at this in Cornwall but decided against. Apart from furnishings, welcome packs, laundry, cleaning, etc., which can all be found at a cost, you have insurance, business rates (as it’s a business now not residential), fire regulations (need fire doors, smoke detectors almost in every room) and a steady stream of constantly changing regulations.

Long-term letting turned out to be easier and more profitable. If you want to do it, I suggest getting an agency to come round and talk you through it. They will probably recommend a fire assessment as well, to give you a good idea what you will need to do.

 

[deema]

I used to have a Holiday let in the lakes. The lakes was a good all year around destination and we were say 85% booked. Hopeless investment so we sold it. If they didn’t steel it, they broke it. If they didn’t break it they smoked, threw up over it, walked every where in muddy boots, complained about everything, wanted refunds / compensation, special needs, brought their pets (no pets policy) upset the neighbours with parties, kids screaming running riot.
Cleaners were sometimes hit and miss, the management company struggled to keep on top of repairs / replacing stuff (just accept it’s a new welcome pack every guest). If the guests order a ‘starter pack’ of provisions, bet your bottom dollar some products will be 24 hrs shelf life, or even out of date / not a good enough brand / they are allergic to / not inline with beliefs etc etc.
Then there are bed bugs, we were lucky didn’t have the issue, but a friend did. Prevalence in the UK is increasing significantly, and getting rid is expensive.

I don’t think I’d recommend it to my worst enemy!

 

[deema]

I think with the new legislation coming down the pipeline long term let properties are also going to be a money trap too. Read up what is proposed because it’s a complete nonsense unless you want to provide social care. I suspect strongly that when the new rules come in getting proper insurance to protect you from tenants not laying fir instance will evaporate just like it did in Covid when equally you couldn’t get rid of nine payers / lunatics.

For all those who disagree with my point of view, buy a property to let and then make an informed opinion. There is a tragic shortage of properties to let, and it keeps getting worse every time more stupid left wing carp legislation comes down the pipeline. The simple fact is, there is and always will be a need for decent good quality affordable rental properties. The best properties are usually owned by private individuals with one or two rentals they’ve bought as retirement investments. These landlords are the ones turning their back on this investment. How do I know? Well I have a few rentals and my son owned an estate agency / property rental business. Every piece of new ‘protective’ legislation just forces rental prices up both to cover the cost of the new rules and by driving further the shortage.

 

[Jones]

Like anything the amount you get out will depend on the effort you put in. If an agency does everything they will take most of the money. Also be aware that the agencies interest is their business not yours, in a dispute they will favour their customer with your money .We do have a four bedrooms holiday let in Snowdonia . Last year occupancy was 60 percent, income £37000, profit £21000. We list on Airbnb and booking.com not through an agency .I do most of the cleaning, repairs and repainting myself ,it adds up to one day a week. If you can't do that add at least £6000 to costs also consider that mortgage interest will not be an allowable expense from next year.

 

[Blackswanwood]

The house over the road from us is a holiday let Doug - probably the same distance north of York as you are south.

The owner lives in an adjoining property and so is on hand to look after everything. It works for them as a lifestyle business and is pretty much occupied throughout the year (if not during the week certainly at weekends).

They’ve only had one bad booking where there was some unpleasant cleaning up and broken glass to clean up.

The daughter of another neighbour has an Airbnb in York (Bishopthorpe Road area). She had lived in the house before moving in with her partner. It’s far less straightforward as she’s reliant on third party cleaners etc and had had a fair few instances of breakages/partying guests etc. She still thinks it’s more profitable than a BTL (I’m not entirely convinced) and puts up with the hassle.

 

[XTiffy]

We built a pair of high-end semi-detatched houses in West Sussex. With the rise of Air Bnb they became untenable. The requirements both legal and practical were a nightmare. I would never go back to that. There are a lot of hidden costs and you need to go into it very deeply. What changed with Air Bnb was short term stays, two to three days particularly weekends. This makes it almost impossible to let the rest of the week. Thus you need to figure on a very much less % occupancy.
The residential rental market has been destroyed by well meaning but stupid legislation. People seem to forget that no company no matter how big or small pays any tax, they COLLECT it for the Government (whichever party is in power) to squander. All expenses from business are part of the price charged to the customer (which includes taxes). Eventually all residential property will be owned by Banks, Insurance companies and venture capitalists, then they will be shooting fish in a barel.

 

[Phil Pascoe]

when equally you couldn’t get rid of nine payers / lunatics.

non payers?

 

[Terry - Somerset]

I have a BTL flat let via an agent. It is a part of my retirement income, not a business. Rental yields were much higher than interest rates and I felt more comfortable with a physical asset which had historically increased in value, rather than digital evidence (shares, ISA, bank account)

Agents are not a cheap option but I don't get phone calls etc at the weekend or when away. I don't want to fix problems myself (although able) and do not have sub-contractors (plumbers, electricians, painters etc) on tap who will respond rapidly.

Airbnb and holiday lets inevitably involve changeover, cleaning, and probably more damage. More hassle and more agent cost for promotion and booking + possibly changeover.

That there is increasing regulation over all property rental means unless you are able to treat it as a business and stay up to date you will eventually fall foul by omission. That many landlords are deciding to sell is no surprise - although I probably won't.

The impact of anti-landlord policies makes no difference to total property available which requires new build. Supply and demand economics simply increases rents (a) by imposing additional requirements on landlords and (b) reducing supply.

 

[Doug71]

Thank you for the replies, despite all the negative feedback I'm still thinking about it

My ex is the type who would love doing the management, selling, social media type stuff needed for a holiday let and I will happily do the change overs etc. The plan would be to hopefully still do the self employed joinery thing for maybe 3 days a week when I wasn't changing sheets and cleaning toilets

What has got the idea in my head is a customer of mine in the next village has moved into rented property so they can rent their own house out as a holiday let. It is a nice place, sleeps 10 and on the photos looks like a proper country house. Looking on Booking.com it starts at £887 per night and reaches £1.5k per night in August and I reckon it's at 50% occupancy between now and the end of August. I know my place wouldn't fetch that kind of money (I don't have a hot tub ) but it makes me think there is a market out there.

I would be moving into a little house which I currently rent out so I would lose the income from that which I need to take into account.

Another reason I would like to set it up is that it's something the kids could take over a few years down the line.

 

[Jones]

The rates you see online aren't the rate you will regularly get. You can minus 16% for their commission ,then consider that multiple days will usually have discounts attached. Would you pay 1500 per night?

 

[XTiffy]

I would say that the negative feedback is from "real world" individuals with experience.

 

[Jameshow]

Thank you for the replies, despite all the negative feedback I'm still thinking about it

My ex is the type who would love doing the management, selling, social media type stuff needed for a holiday let and I will happily do the change overs etc. The plan would be to hopefully still do the self employed joinery thing for maybe 3 days a week when I wasn't changing sheets and cleaning toilets

What has got the idea in my head is a customer of mine in the next village has moved into rented property so they can rent their own house out as a holiday let. It is a nice place, sleeps 10 and on the photos looks like a proper country house. Looking on Booking.com it starts at £887 per night and reaches £1.5k per night in August and I reckon it's at 50% occupancy between now and the end of August. I know my place wouldn't fetch that kind of money (I don't have a hot tub ) but it makes me think there is a market out there.

I would be moving into a little house which I currently rent out so I would lose the income from that which I need to take into account.

Another reason I would like to set it up is that it's something the kids could take over a few years down the line.

Bit of an aside how do you manage to have a holiday let with your ex?
We have one and are going through a divorce and it would be nice for the kids if we kept it. I wonder if thats possible. Pm me if you want.

Cheers

 

[Fitzroy]

Holiday Let! I read Holiday Jet and thought how are there eight replies, are UKW folks that loaded.

 

[Iestynd]

I'd go into this VERY carefully. The chancellor has announced that the favourable tax treatment furnished holiday lettings currently benifit from will be abolished with effect April 2025!
This includes offsetting your mortgage interest against the income to reduce tax liability.

I'd be tempted to sell the propery and invest the money elsewhere... Maybe some new tools

But on a serious note, putting it into your pension to reduce your personal tax, or investing it through ISA wrappers would be a lot less hassle and almost as good a return i would imagine (after the expenses you incur etc).

Just my 2 pence worth. (I'm not offering financial advise - the above is my own opinion).

 

[Cobbs]

Probably going to get battered for this, but IMHO, there should be no such things as holiday lets or "second homes". All they effectively do is put up the prices of property and take housing stock out of the housing stock, if you see what I mean. I have no problem at all with people owning more than one property, but if they do, they should be compelled to rent out the "spares" on a long-term basis.
In lots of the more scenic parts of the country a huge proportion of the houses/flats/whatever are owned by people who leave them empty for large parts of the year, while locals struggle to find anything to rent or buy. Second homes in particular are usually owned by people outside of the area who object to new houses being built and spoiling "their" view, when they are the very people who cause the problem of insufficient housing. If you want to visit an area, do so by all means, but stay in a hotel or bed and breakfast, you'll almost certainly save money and be employing the locals at the same time - win, win. Also of course, as others have pointed out, if you're the landlord, it will probably be less stressful in the long run to have a long-term tenant.