FACT
FILE - Buy to let – Holiday Homes – Outside the
UK
The
Buy
to let
market has been growing considerably in the UK since the
mid 1990’s and now with the growth of second homes
outside the UK there is even a greater market.
Where
to begin?
First of all decide on why you are buying – Do you
intend to live in the property for holidays or purchase
a property purely to let out permanently?
Long
term renting:
If you are going to buy a property purely to let out, then
you should seek the assistance of a professional estate/letting
agent in the country that you choose. Most countries have
different systems for letting out a property and you could
find that you have to commit the letting up to nine years.
You should also seek specialist help regarding the location,
whether to let it furnished or unfurnished.
Holiday
rentals: If
you go down this route it will mean that you have the benefit
of an income from the property plus the opportunity to take
your holidays there.
First
of all you have to decide on a country - France one of the
most popular, Spain still very popular like Portugal and
Cyprus. Then there are the less well known destinations
- Greece, Turkey and Eastern Europe.
Many
people start their research by looking at a country they
are familiar with. You then have to decide on the location.
If you are aiming to let the property to cover costs and
mortgage repayments then you must purchase it in an area
that is going to be popular with visitors. You should also
take care right from the start not to overstretch your budget.
Remember that you will often have to pay a purchase tax
on the property, lawyer’s fees and in some countries
agent’s fees when you purchase.
The
next decision is your market. Are you aiming solely at the
UK and Irish market – this will mean it will have to
be located close to airports or are you considering a wider
market – Dutch, German & Scandinavia for example? A
wider market will naturally give you more opportunities
to let the property, but you also have to promote it in
those additional countries.
You
have now decided upon the country and the area within that
country. How do you find that property? There are several
ways. Companies organise expositions in many countries like
the UK and Ireland. Here you go along to a local hotel and
collect the information and this is followed up by an inspection
flight. You will often find that these properties are just
being built or are going to be built. Many of these companies
are now offering second hand properties.
There
are numerous property and country magazines with pages of
ads for new and second hand property that is available and
many newspapers advertise similar properties.
A
very popular method is the Internet. If the agent’s
site is good you should get several photos of one property
and many agents will be happy to email you further pictures.
If you are then planning an inspection visit, arrange several
appointments so that you get an idea of what various properties
are like. Many agents speak your language as well and if
in doubt take along a friend who can help.
If
your property is located in a country that is very warm,
particularly in the summer and you have the opportunity
of buying a place with a pool, this can certainly boost
rental income and make it more attractive to rent. There
are of course additional maintenance costs involved with
a pool.
WARNING
- RENTAL SCAMS IN HOLIDAY LETS CLICK
HERE FOR DETAILS YOU COULD BE NEXT!
Furnishing
it –
You now have the right property – the next step will
be furnishing it. Equip the kitchen well. People on a self
catering holiday don’t want to spend a lot of time
washing up – provide a dishwasher if possible. A washing
machine is an essential and a television is very welcome
particularly on a wet autumnal evening. Along with a television
you might have to consider a satellite system and which
one will depend on your core market.
Most
people have mobile phones, so it is not necessary to provide
a telephone. If you do, contact the telephone provider to
find out ways of providing one in a holiday home whereby
you don’t find you are paying someone else’s phone
bill. Even if you have incoming calls, someone can always
accept a reverse charge call to your phone!
Remember
to take into account safety measures. Install a smoke detector,
have your appliances checked (in some countries it is the
law) and make sure that the furniture is smart, in a good
state of repair and if applicable compliant to local safety
regulations. Breakages can occur so provide crockery and
glassware that can easily be replaced at the local supermarket
or department store.
Bedding
& bed linen:
Decide whether you provide this or not. It is an additional
cost – not only for the initial (plus replacement purchase)
plus the ongoing associated laundry costs.
Local
agent:
- You will need to consider in your financial planning the
costs of employing a local agent. This can be in the form
of an agent who finds visitors to rent the property and
checks them in and out, arranges maintenance etc, or purely
someone who just acts as a key holder and checks your visitors
in and out and generally manages the property for you.
Alternatively
you can just employ an agent to check the visitors in and
out and organise routine maintenance. Some people get to
know a neighbour and ask them to do this. If you go down
this route, it should be on a business footing.
Letting
& Marketing: –
don’t reserve the best letting weeks of the year to
yourselves, particularly if you need the rental to pay for
the property. Try and visit it off season. It is good to
go there at least twice year, to check on its state and
condition and also to carry out any repairs or garden tasks
that have not been attended to.
The
amount of time during the year the property is let will
depend on your outgoings; there are several ways to find
holiday renters. You can use the Local agent, list it with
a holiday company back home or advertise it yourself using
a specialist holiday publication (or several of these) or
try the national newspapers. Advertising costs can mount
up, particularly if you are not getting the enquiries. As
more and more people are turning to the Internet, look for
a specialist site like
CLICK HERE You
simply pay an annual fee of under £100 and the enquiries
go straight to you. Many people then decide to have their
personal website. This can provide a lot more additional
information about the property, area and if it is well illustrated
with photographs, you have then developed your own brochure
on line. The costs of building a website can be quite high,
so shop around and don’t go for something that is too
fancy, has long introductions and large photos\that take
a long time to download. People using the web, so get bored
and want quick results.
Finally
remember – get your rental
price attractive to attract renters
Wills:
You should make arrangements whilst you are in the process
of purchasing your property to make a will in that country
in relation to the overseas property. In some countries
like France there can be inheritance problems whereby children
automatically benefit rather their mother. The lawyer handling
your purchase can be consulted about local formalities.
Check
List rules for a Buy to Let Property
Buy
in a country that you know – As you will also be wanting
to stay there, make sure that you can get there easily.
Research
the up and coming areas.
Target
the market you want your property to appeal to.
Don’t
make too many restrictions on the letting – You must
consider family lets, pets travel all over Europe these
days.
Get
the rental price correct. It is no good setting a high price
when people are not interested in renting your place. Check
out the prices of the competition.
Location
of property – is it within easy traveling distance
of an airport? How far away is the nearest motorway –
town or beach or lakes the property located with regular
water supplies and electricity? If the property is on a
septic tank remember that the maintenance has to be arranged.
Don’t
just buy a property that appeals only to you – if you
are buying to let you need to consider firstly those who
will be paying the costs – your paying guests.
Finance
– Your rental income has to cover the mortgage –
the upkeep of the property – the marketing costs –
Paying for a local agent to administer guest transfers –
Tax (local property taxes plus income tax in the country
the property is located in / or back in your home country)
You
must think about this as a long term investment – you
should also take into account that you might buy when property
has had a history of rising in price, however there can
always be the possibility of prices falling in your chosen
country or region and your property no longer being in a
“fashionable” holiday area.
Insure
the property – Buildings, contents and for your paying
guests.
Provide
your visitors with an Information folder for the property
and don’t refer to them as “Tenants”. Many
people do not like this term.
If
you are going to spend your own holidays at the property
and want to keep some of your own personal belongings away
from your paying guests, try and build, or use a specific
cupboard, cellar area etc to keep locked.
N.B. This information should not be relied
on for accuracy and is presented here without the responsibility
of jml Property Service and the website it is being displayed
at. ©jml property Services 09-04
Advertise
your Holiday Home Property at jmlvillas.com
- CLICK
HERE
for Details
Buy
in France
Click
Here for further Information
for
Property
- Property Rentals - Overseas Property 
