An Insider's View

How the holiday letting business has changed in recent years

Coastal residences, period houses and traditional, thatched chocolate-box cottages will always be at a premium, but these days they are often rivalled for successful holiday letting by cutting edge, modern properties with designer features or access to leisure facilities. The demand these days is for more upmarket, quality, self-catering holiday homes than it was 20 years ago, with holiday lets providing either the same or better amenities than a guest has at home. The most recent additions to our portfolio have plenty of space, comfort and facilities, and can come in many shapes or forms, from a converted barn or village school to a large penthouse apartment with panoramic water views. It is fast becoming the norm to have a bathroom for each bedroom, a designer kitchen, zip-and-link beds, the latest technology such as digital TV, DVD, Sky and internet access, a wood-burner or open fire, and full central heating. Extras such as a games-room, gym, swimming pool, hot tub or jacuzzi bath are not unusual today.

The trend in recent years has been a move towards more short break holidays. This has been made easier by the advent of the internet, and visitors being able to book last minute on-line. It is also a media where we have seen a huge revolution in the marketing of holiday homes. Advertising on the Web now accounts for over 80% of our new business. It is however a cut-throat industry and the competition to stay at the top of the search engine pages is immense – our IT department work on this continuously.

The factors we take into account when deciding whether to take on a holiday home

The key factors are always location, size, and the facilities provided, with location being the prime factor. When looking at the location we use our long experience and take into consideration the demand for holiday homes of a particular size in that region. This varies from one area to another and from one season to another; for example, large properties near the coast will suit two families holidaying together in the summer, whilst small romantic retreats on the moors will suit couples taking short breaks in the winter. When looking at new holiday homes to take on, sea, river or countryside views would be our main consideration, followed by the property’s proximity to neighbours (for many guests, privacy is a key element of their holiday). Factors such as the size of the garden, and whether it is enclosed for dogs or children, also come into play. Comfort, interior design and the facilities provided are very important, and we will help with advice on layout, design and furnishings, to maximise the letting potential of the holiday home. Other important factors that we take into consideration are parking, and the type of heating provided (which can affect the length of the letting season), accessibility and whether the property concerned would photograph well for promotional purposes. For inland holiday homes the additional facilities of a pool, games-room or hot tub can make a difference to bookings. These days, as the market place becomes more and more competitive, the criteria we use to assess holiday homes have become ever more stringent.

What is our most popular type of property?

Our most popular properties vary tremendously; some people prefer a thatched, beamed cottage nestling in an archetypical country garden, and others a designer-style modern apartment perched on the waterfront, or a clifftop house with stunning views. What they all have in common however is some form of ‘wow’ factor, together with quality furnishings and thoughtful attention to detail throughout. Immaculate cleanliness is a pre-requisite. Our aim is to entice guests back time and time again, so holiday homes that are well-maintained and constantly updated are the ones that do best. On arrival the guests should feel that they have arrived somewhere better than ‘home from home’, where the perceived value is greater than the cost of the holiday.

Advice to people who are thinking about going into the holiday letting business

Our advice would be to select a holiday home somewhere you would choose to holiday yourself and somewhere that would suit your own personal use. Most importantly, the property must be a desirable destination for your potential guests. In essence, this means that the house itself, its setting and/or the view should be capable of producing good photographs so that it will stand out against the competition in a brochure or Web site. At the top end of the market, good quality, comfortable homes can command a substantial high season rental and a long letting period throughout the year (Christmas and New Year demand peak rates). Unlike long-term letting, holiday lets are regarded as a business by the Inland Revenue with consequent tax advantages. The most important one is that your holiday home, as a business asset, achieves maximum Capital Gains taper relief after just two years.

Discerning guests will want space and privacy both inside and out, so rather than trying to accommodate more people, remember that an extra bath or shower-room may add better value than another bedroom. Some of our most popular holiday homes have an equal number of bedrooms and bathrooms, ideal for couples or multi-generation families holidaying together throughout the seasons. Smaller groups also mean less wear and tear – and in a rural or beachside house, a downstairs shower-room will prevent a trail of outside dirt or sand throughout the house.

Gardens that offer shelter and privacy will always be more attractive to relax in than a shared area or courtyard, so bear this in mind if planning to convert a range of buildings.

Buy the best fittings and furniture you can afford – your guests will be delighted to stay in your holiday home, will want to come back, and so will cherish it in return. Quality fabrics, carpets and upholstery will last longer, clean better and be well respected by all who stay.

The hidden costs and legal pitfalls Owners need to know about

Always check planning permissions before marketing a holiday home that has yet to be built and take plenty of time in your own planning process. It is surprising how many times a holiday home is marketed for six months prior to being finished, only for the layout to be changed substantially before the project is completed. This can obviously lead to extra costs when guests who have already booked have to be refunded or moved to an alternative property when their expectations are not met. Once the purchase of a holiday home is complete, seeking advice from experts such as ourselves about layout and design before conversion or restoration can save on expensive mistakes and help to maximise bookings.

Other hidden costs include breakages and wear and tear of the property – be sure to obtain good holiday home insurance cover which takes into account specifics relating to holiday letting. This will also ensure that you avoid certain legal pitfalls. Utilising good holiday letting agents is another way of gaining sound advice on all aspects of holiday letting, from proposals on layout and design to advice on dealing with guest complaints.

Mary
Head of the Property Department