Why invest in a holiday or second home?
Renting holiday homes, either in the UK or abroad is a common holiday type for most people.
You may have been charmed by a modern Spanish villa, or a quaint cottage in the Cotswolds, and even asked yourself whether buying a holiday home yourself would be a good investment.
But should you actually do it?
Francisco Mesa Baya, Director
Investing in a second or holiday home is not only an effective way of generating income but is something that you can enjoy too!
You can have the best of both worlds, renting it out and holidaying yourself.
However, it is a big decision that requires a lot of thought and consideration and needs a financial strategy too.
You need to get your investment strategy right from the start in order to reap the benefits of your holiday home.
For example, mortgage brokers and development finance lenders, Mesa Financial are a regulated finance company that advises on high-value borrowing transactions and buy-to-let mortgages if you're considering buying a home to rent it out. See how they can help.
What are the benefits of owning a holiday home?
- One of the biggest benefits of owning a holiday home is the rental yield that can be gained from your investment.
- If your property is well-located and in a sought-after location, then you can receive double the rent of typical buy-to-let properties.
- A well-placed property will always get holidaymakers paying a little more to get their dream holiday accommodation.
- Much like any property development project or portfolio, capital growth has long-term benefits, which is often used as a pension later in life.
More information on how to boost your pension income.
The UK tax policies state that holiday home ownership is a business venture, so there are also several tax benefits to owning your own second home.
Take advantage of seasonal rentals
As well as a steady income throughout the year, you can take advantage of more popular seasons and holidays like Easter, Christmas and bank holidays. You can charge a higher rent during these periods as demands for holiday homes are higher.
Want to know how to maximise your income during the holiday season? Click here for tips. Or consider a company like HelloGuest which specialise in holiday let management and Airbnb marketing. Property management companies like this take care of headaches like cleaning, guest turnover, communication and even marketing so you can sit back and earn effortlessly. Check them out.
How can I buy a holiday home?
As buying a holiday home means buying a home in addition to your current residency, there are a number of funding options.
You may wish to buy a plot of land to construct your holiday home or extend or renovate your holiday home. If so, there are a number of funding options available to you.
Property development finance or funding can help you get your project up and running. Read more here.
Read more > Banks vs independent lenders
