Investors who are attracted to this type of investment are usually drawn towards Holiday Home Buy to Let property by the higher rental yields available from these investments.
Whether located on the coast or a cottage in the country the weekly rent is normally significantly higher for these short let properties than that achieved on longer lease investments, often 2-4 times higher during the peak holiday season.
New investors often use a booking agency, which while diluting profits does often mean a much higher occupancy rate can be achieved. In recent years the growth of independent travel accommodation booking sites has meant many owners prefer to maximise their profits and handle the transactions themselves.
Of course many investors find that any weeks in which the property is unoccupied can be used by themselves and the combination of higher revenue earnings and holiday breaks represents an unbeatable combination.
For this type of investment the basics apply, i.e. is it in an attractive tourist location, what are transport links like, etc. The difficult step for this type of investment is obtaining a mortgage as mainstream lenders are sometimes reluctant to lend in this part of the Buy to Let market. We have however a number of lenders on our panel who specialise in providing mortgages & remortgages for these investments and of course we can give you quotes from the approved Conveyancers and solicitors for these Holiday home buy to let investments.
The changes in the taxes applied to Buy to Let investments have led a number of commentators to speak of a forthcoming boom in Holiday Home Buy to Let investments.
Put simply HMRC can treat Holiday Home buy to let investments as investments in a trading business, so conveyancing and legal costs are still tax deductible against any eventual capital gains on the property, and more importantly as it is a trading business the new tax rules which scale back other buy to let tax relief’s do not apply to Holiday Home investments. If operated as a furnished holiday let and compliant with the rules for these, then these investments can also qualify for entrepreneur’s relief reducing capital gains taxes to 10%. To qualify for these Furnished Holiday Lettings benefits the property and the lettings must meet a number of conditions such as being available for at least 210 days and the number of lets for over 31 days being restricted. In such a short space we could not give you all the conditions and criteria and so this article does not offer Tax advice , it would though be worth your while seeking further advice from a financial expert to ensure you qualify and are maximising the benefits available from these investments.
Of course you always want to maximise your return and minimise your costs no matter what type of Buy to Let property you are looking at. So for a cheap instant conveyancing quote for your Holiday Let property click here