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If you’re fortunate enough to be able to take advantage of the stamp duty holiday and invest in a new property, then a holiday let could be a good option for you. If you buy a nice little place in the UK, for example, you can also make the most of the staycation trend. You can rent it out to tourists, and it’s also ideal to have a holiday home to use with your family. Buying property to rent out is a decision not to be taken lightly, however, and there are many important factors to consider. A holiday let has a few advantages over a more permanent buy-to-let scenario, for instance, here are some examples.
Holiday lets are classed differently according to taxes as well as Holiday Let Mortgages. A holiday let counts as a business meaning that their owners are entitled to more tax benefits than buy-to-let landlords. This includes mortgage interest tax relief. It’s important to bear in mind, however, that a second home will incur a stamp duty of 3%.
Rise in demand
Property experts have claimed more people are buying holiday homes in order to make extra cash from the staycation boom. Travel restrictions have meant there’s been a rise in demand for holiday homes. People are more interested in local vacation spots rather than risking booking holidays abroad.
High rental yields
High rental yields are one of the reasons why holiday lets are a good investment. You can make more profits in a short time, especially if you choose a popular touristic location. The reason for this is that you can charge more. You could earn a month’s rent in a week if you play your cards right, as tourists will pay more for a holiday home.
If you’re concerned about having to deal with tenants, the good thing about a holiday let is that they’ll never stay for long. Even if you have difficult tenants that cause a lot of problems, it won’t be long before their holiday is over and they’ll have to leave. In most cases, you’ll probably get more positive reviews overall as your tenants will have a special and memorable experience in your property. If you provide the best service, it will be mutually rewarding.
Home from home
Another one of the main benefits of a holiday let is that you can use it yourself. If you and your family decide to go on a staycation, you can make the most of your holiday home. Any tenants you have will be on a short-term basis; if you don’t need to rely on the profits you make on your holiday let all year round, you can spend some time there yourself.
A holiday let is a great investment, but remember if it’s a second property you will need to consider certain tax implications. Speak to a mortgage advisor to find out more. They’ll be able to recommend the best solution for you and your budget.