EnglishinWales Posted December 20, 2016 Share Posted December 20, 2016 I am seeing this touted on a few places on the internet. Presumably would be ordinary BTLers who have heard discouraging things about tenants and think holiday makers are the way to go. Or they are trying to get in on Airbnb. Has anyone else seen similar? Quote Link to comment Share on other sites More sharing options...
EnglishinWales Posted December 21, 2016 Author Share Posted December 21, 2016 Nobody? Quote Link to comment Share on other sites More sharing options...
ThePiltdownMan Posted December 21, 2016 Share Posted December 21, 2016 I have noticed properties in the Lakes where the letting income is quoted on the blurb on RM and Zoopla. The decent ones sell quite fast. Quote Link to comment Share on other sites More sharing options...
TheCountOfNowhere Posted December 21, 2016 Share Posted December 21, 2016 I've see worse than that....just seen, invest in property from £1 !!!! Also, buy to let for those insanely prices mobile caravan motor home jobbies. Quote Link to comment Share on other sites More sharing options...
EnglishinWales Posted December 21, 2016 Author Share Posted December 21, 2016 Landlords be like: 'I'm providing a public service by buying houses so holiday-makers have somewhere to stay on their holidays. People need Holidays!!' Quote Link to comment Share on other sites More sharing options...
One-percent Posted December 21, 2016 Share Posted December 21, 2016 Coming from a town which now has tourism as its main source of income, I really don't see how the figures stack up. Holiday makers expect high quality and pristine. Don't always treat with respect so high maintenance costs plus there are a lot of weeks when people just don't go on holiday, especially in this country. Quote Link to comment Share on other sites More sharing options...
ThePiltdownMan Posted December 21, 2016 Share Posted December 21, 2016 https://www.cumbrian-cottages.co.uk/northern-lakes/keswick-area/greengables-cc111297?adult=2&nights=7&range=0&start=01%2f07%2f2017&availabilityselected=true#cottage-overview This one was on the market a few weeks ago for 395K. The quoted gross annual income was 24K. I would not be surprised if the net return was 1/2 that which is pretty poor - unless you are banking on continued gains. Quote Link to comment Share on other sites More sharing options...
EnglishinWales Posted December 21, 2016 Author Share Posted December 21, 2016 www.uswitch.com says it "can be a worthy investment". Is this what they say to people in Cornwall who can't afford to buy in their own village? Quote Link to comment Share on other sites More sharing options...
EnglishinWales Posted December 21, 2016 Author Share Posted December 21, 2016 3 minutes ago, ThePiltdownMan said: https://www.cumbrian-cottages.co.uk/northern-lakes/keswick-area/greengables-cc111297?adult=2&nights=7&range=0&start=01%2f07%2f2017&availabilityselected=true#cottage-overview This one was on the market a few weeks ago for 395K. The quoted gross annual income was 24K. I would not be surprised if the net return was 1/2 that which is pretty poor - unless you are banking on continued gains. They say that people are staying at home more rather than holidaying abroad (staycations) but there's a limit to how many self-catering cottages are needed. If holiday let rents drop because of oversupply then the house sits empty and another family is prevented from living there. If the housing market is still stagnant next year maybe the chancellor could look at this issue. Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted December 21, 2016 Share Posted December 21, 2016 Buy-to-let loans can't legally be used to finance holiday lets because doing so would breach the T&Cs, which generally only allow for Assured Shorthold Tenancies. Using a BTL loan for that purpose would be mortgage fraud, and runs the risk of jail terms, fines, confiscation of the property, etc. Quote Link to comment Share on other sites More sharing options...
spyguy Posted December 21, 2016 Share Posted December 21, 2016 Hmm, I have a lot of real and anecdotal experience. Disclaimer - My mum has a house she lets out. Its has not finance on it. It suits my mum as she can potter to it and clean and manage everything . There are very few banks or BS that will lend to holiay lets. By that I mean about 2: http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/11979388/Why-holiday-homes-will-be-the-next-buy-to-let-boom.html They have very strong reasons for not lending. Unlike BTL, holiday lets have been thru a boom bust cycle. The banks were badly burnt. Again, any loans on houses not OO are very risky and liable to default. You will be lucky to get school summer holidays - ~ 15 weeks a years. Fro the article: 'Their experience is mirrored by another couple, Barry Smith and his wife, Ros, who have enjoyed a gross income of up to £30,000 annually for the past six years after buying two barns near their home, close to the Mendip Hills. Mr Smith said: “It has been a phenomenal success. Over the last six years, we have a track record of 80pc occupancy which has taken me by surprise, as we are not in what you would normally consider a ‘holiday’ location.” ' So thats, 15k per barn, Im not sure what the 80pc is from but if its 80% of 52 = 30 weeks, thats 500/week per barn. Thats not a lot. No price, so cannot comment on the yield. When i see people saying 'xyz is available' I check the availability. Its not unusual to see 2 weeks at xmas, then nothing til August. Thats a very hard cash flow is theires debt on the house. HMRC have a rule on that a holiday let must be let x weeks/year. This has been raised in the last couple of years. If you fail to let it those days then there are problems with tax relief - you might need to pay it back. The cost of maintaining and cleaning a holiday let are very high. Each change over will cost you ~100-150 quid - if you can find anyone willing to work just one day a week. Most places change over Friday or Saturday. Its not unusual for the owner getting a call to say no ones cleaned the house - You have to live ~30 minutes from the place or you'll be having some very long drives at weekends. How do people buy holiday lets. It appears most take equity/loan out on their OO. Why do they do it? because they are idiots. Quote Link to comment Share on other sites More sharing options...
spyguy Posted December 21, 2016 Share Posted December 21, 2016 41 minutes ago, EnglishinWales said: They say that people are staying at home more rather than holidaying abroad (staycations) but there's a limit to how many self-catering cottages are needed. If holiday let rents drop because of oversupply then the house sits empty and another family is prevented from living there. If the housing market is still stagnant next year maybe the chancellor could look at this issue. Even with the fall in the pound., most people still go aborad. The idiots go to Egypt (FFS). The rest go to Spain. An all inc. Spanish resort - booze and food is still cheaper than a UK stay. Quote Link to comment Share on other sites More sharing options...
EnglishinWales Posted December 21, 2016 Author Share Posted December 21, 2016 That's why there's special buy to holiday let mortgages available. Google it, a few places are offering them 32 minutes ago, Neverwhere said: Buy-to-let loans can't legally be used to finance holiday lets because doing so would breach the T&Cs, which generally only allow for Assured Shorthold Tenancies. That's why there's special buy to holiday mortgages/loans available. They are out there. I just wondered what the attraction is considering the current situation. Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted December 21, 2016 Share Posted December 21, 2016 26 minutes ago, EnglishinWales said: That's why there's special buy to holiday let mortgages available. Google it, a few places are offering them That's why there's special buy to holiday mortgages/loans available. They are out there. I just wondered what the attraction is considering the current situation. Sorry, I misunderstood the OP and thought you were discussing property listings advertised as "buy-to-holiday lets". Quote Link to comment Share on other sites More sharing options...
EnglishinWales Posted December 21, 2016 Author Share Posted December 21, 2016 I'm sure I have seen at least one cottage somewhere on rightmove that said something like 'ideal for holiday rental'. Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted December 21, 2016 Share Posted December 21, 2016 14 minutes ago, EnglishinWales said: I'm sure I have seen at least one cottage somewhere on rightmove that said something like 'ideal for holiday rental'. Yep, me too. I guess the attraction is probably that people (incorrectly) see house prices as a one way bet, underestimate the work involved, and perhaps like the idea of a holiday home that they can use themselves in the off season. Quote Link to comment Share on other sites More sharing options...
spyguy Posted December 22, 2016 Share Posted December 22, 2016 8 hours ago, EnglishinWales said: I'm sure I have seen at least one cottage somewhere on rightmove that said something like 'ideal for holiday rental'. About 50% of the RM listings near me tend to get the ideal holiday let in somewhere. I really would not advise buying a holiday let with finance. Quote Link to comment Share on other sites More sharing options...
spyguy Posted December 22, 2016 Share Posted December 22, 2016 9 hours ago, EnglishinWales said: That's why there's special buy to holiday let mortgages available. Google it, a few places are offering them That's why there's special buy to holiday mortgages/loans available. They are out there. I just wondered what the attraction is considering the current situation. I did google. There are very few available. Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted December 22, 2016 Share Posted December 22, 2016 AIUI as well as being much lower in number they're also nothing like buy-to-let - despite how they may be being marketed - as they require much larger deposits, much lower debt profiles, and sufficient independent income (i.e. from sources other than the holiday let itself) to fully cover monthly repayments. Quote Link to comment Share on other sites More sharing options...
spyguy Posted December 22, 2016 Share Posted December 22, 2016 27 minutes ago, Neverwhere said: AIUI as well as being much lower in number they're also nothing like buy-to-let - despite how they may be being marketed - as they require much larger deposits, much lower debt profiles, and sufficient independent income (i.e. from sources other than the holiday let itself) to fully cover monthly repayments. Holiday let mortgages have, roughly, the same risk as BTL mortgages. The fact that they are a few and far between expensive and require large deposits ought to give you an idea where BTL is going. And there's no such thing as an IO holiday let mortgage either. Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted December 22, 2016 Share Posted December 22, 2016 53 minutes ago, spyguy said: Holiday let mortgages have, roughly, the same risk as BTL mortgages. The fact that they are a few and far between expensive and require large deposits ought to give you an idea where BTL is going. And there's no such thing as an IO holiday let mortgage either. Hopefully so. Quote Link to comment Share on other sites More sharing options...
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