Where to buy a holiday home
A quintessential cottage in the British countryside, beachfront villa in Cornwall, or cosy cottage in the Scottish mountains? Choosing the location of your holiday home can be influenced by personal preference, but you should also take into account whether the area has appeal for holiday makers.
Opting to buy a holiday home abroad has obvious advantages, especially when considering the climate! If Brits seek hot weather, alfresco dining and sunbathing on a golden beach, they’re far more likely to book a getaway abroad.
Aside from the unpredictable Great British weather, buying a holiday let in the UK has definite perks, especially due to the rising popularity of staycations. As the owner, travelling to and from the property will be easier and cheaper; whether the travel is for leisurely trips or necessary visits, it’s a perk to be closer to your holiday home.
It’s important to do extensive research when buying in the UK. There are restrictions in certain areas, such as St Ives in Cornwall, on buying a second home, that should be considered.
Whether you choose to buy abroad or in the country, it’s vital to think about the local competition. Whilst it’s advisable to choose an area that’s popular with tourists, you don’t want to be shrouded by holiday homes that are similar to yours. Find a place that stands out from the competition and will secure bookings.
In addition to the financial considerations, there’s a number of legal obligations which you must abide to when buying a holiday home.
Once you own the property, you will be responsible for health and safety of your guests and you must review and take steps to ensure your holiday home meets current regulations. For example, you must carry out a general safety review of the house and its grounds, identifying dangerous drops or potential trip hazards. If your property has gas, you must have the boiler and gas appliances checked and signed off by a GasSafe engineer. You should conduct or arrange for a fire risk assessment and equip your holiday home with items such as a fire blanket, smoke alarm and carbon monoxide detectors. You must insure your property with an appropriate level of public liability insurance, normally at least £2m.
Profits generated by a holiday let are subject to income tax. However, unlike buy to let properties, there is no limit on the amount of mortgage interest you can offset against those profits, thereby reducing your income tax bill. If you have a mortgage on your cottage, this can be a very significant saving.
Holiday home owners are entitled to capital allowances for certain items that are required in the running of the property, such as furniture and large fittings. Also, all genuine expenses incurred in running and maintaining the holiday let can also be deducted from your gross income.
Holiday Let Mortgages. Done.
Holiday Cottage Mortgages Limited is an Appointed Representative of Julian Harris Mortgages Limited, Julian Harris House, Musgrove, Ashford, Kent, TN23 7UN, which is authorised and regulated by the Financial Conduct Authority (FCA). Julian Harris Mortgages Limited’s FCA Register number is 304155. The Financial Ombudsman Service (FOS) is an agency for arbitrating on unresolved complaints between regulated firms and their clients. Full details of the FOS can be found on its website at www.financial-ombudsman.org.uk
Your home may be repossessed if you do not keep up repayments on your mortgage. Pure holiday let, buy to let and commercial mortgages are not regulated by the FCA.