‘How does holiday let insurance work?’ is a common question that we at Sykes get asked, especially by owners...
In this post, we give the top 10 tips for letting out your holiday let – whether you’re an experienced owner or are taking your first steps in this exciting journey, you’re bound to pick up some valuable advice and tips in this post.
1. Where to buy a holiday home in the UK
2. What mortgage do you need for a holiday let
3. Take advantage of tax benefits
4. Holiday Home Insurance
5. Features that increase your booking value
6. The small touches make a difference
7. Make a welcome pack
8. Be flexible with bookings
9. Listen to feedback
10. Grow your holiday let business
Deciding where to buy your holiday let is an important decision and there are certain things you’ll want to consider. If you plan on visiting the property frequently, then you’ll want to choose an area that suits your needs. You ought to take into consideration the impact an area can have on your occupancy and booking value, for example, cottages in areas such as Cornwall or the Lake District are extremely popular with UK holidaymakers.
If you intend to carry out maintenance and manage changeovers yourself, you need to factor in the flexibility of you being able to visit the property. Holiday cottage owners who choose to not have a hands-on approach with their property, arrange for someone else to do this for them. A reputable holiday cottage agency can organise these services for you.
Read our guide about the best places to buy a holiday home in the UK.
The type of mortgage you require for a holiday rental may be different from a standard residential mortgage or that of a long-term rental property. Many buy-to-let or residential mortgages do not allow you to let out the property as a holiday rental or on a short-term basis. Some mortgage providers offer packages specifically designed for short-term rental properties and are more flexible with the amount of income your property receives. Seeking advice from someone who has experience with holiday let mortgages would be beneficial.
Unlike long-term rental properties, which are classed as an investment, short-term rental properties are treated similar to a business and come with certain tax advantages, such as Capital Gains relief and allowable expenses. These benefits allow you to offset expenses you incur, such as utility bills, agency fees and some furnishings, against your annual profits.
Read our holiday cottage tax guide.
Obtaining the appropriate insurance policies for your holiday let will protect you from any unfortunate mishaps that may occur; this could be as small as a guest accidentally breaking something in your property, to serious damage caused by a fire or flood. There’s a variety of insurances for you to choose from, including buildings insurance and Public Liability Insurance.
Read our Guide to Holiday Home Insurance.
It may not come as a surprise that certain features are extremely desirable in a holiday home, but did you know that welcoming pets to your property could have a significant impact to the number of bookings you receive? Or, adding a hot tub or log burner can both increase the appeal of your property and its booking value? Time researching what features are in demand in your area and what the competition are offering can provide you with the opportunity to distinguish yourself from other holiday homes in the area.
Small touches go a long way to making your guests feel comfortable in your holiday home. Simply turning the heating on during the winter months, prior to your guests’ arrival, or adding a few cosy touches to make the place feel welcoming and homely, can make a significant difference to how your guests feel during their stay at your property. Why not leave some treats for your guests to enjoy when they arrive?
We often take for granted how complicated our everyday appliances can be to someone who is unfamiliar with them – from operating the shower to programming the timer on the oven. A welcome pack is effectively a ‘survival guide’ to your property and ensures your guests remain relaxed during their stay. Creating a welcome pack is also a good opportunity to provide information on the surrounding areas: where’s best to eat, what’s the local taxi firm, etc.
Read our guide on how to create a successful guest information pack.
Last year, over 40% of all holidays taken in the Lake District and the Peak District with Sykes were short breaks and nearly half of all holidays taken in the winter months are short breaks. With the demand for this type of holiday increasing, making your property available for short breaks exposes your property to a large market. You may want to also consider accepting last minute bookings as holiday cottages that accepted last minute breaks gained three times as many short break bookings.
Many of the most popular holiday cottages in the UK achieve great ratings because they’re proactive when it comes to negative feedback and resolve issues to ensure future guests have the best possible experience.
It’s important to provide your guests with a channel to give their feedback and recommendations. Listening to this feedback and making improvements is the best way to increase the number of repeat bookers your property receives. Whether it’s as simple as providing an extra set of towels for the hot tub or adding more seating to the garden, improving the experience your holiday home provides is the best way to maximise the number of bookings you receive.
The most successful holiday cottage owners are continually making improvements to their properties by reinvesting a portion of their profits back into their holiday cottage business, whether it be adding desirable features, renewing furnishings or expanding their portfolios into multiple properties. Owning multiple holiday homes may not be something you wish to explore, but, at the very least, you ought to be investing money in keeping your holiday home to a high standard, as you’ll want to ensure your property has a continual flow of bookings and receives the maximum potential booking value.
*Based on a 7 bedroom property in the Lake District with bookings between October 2017 to September 2018.
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