Things to consider when purchasing a holiday home
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Your support makes all the difference.A retreat for the weekends, Christmas or summer getaways for friends and family, a holiday home is undeniably a luxurious asset for those lucky enough to own one. If you’re thinking of joining the holiday house club, here are some points to consider. Oh – and be prepared for the sudden influx of messages from friends in need of a break once your news is out on Instagram…
The first point to consider is how often you will actually be using the house. Employing a property manager might be necessary if your usage of the property is minimal throughout the year. However, there are different precautions you need to take if you are thinking of letting the house out in the months or weeks you plan on living in your first home. For example, you need to be aware of the local competition in the lettings market. Ensure your holiday home has a distinct unique selling point. A stunning view, tennis courts, a swimming pool, games room or outstanding architectural features will appeal to prospective holidaymakers, so bear this in mind when scouting out your new holiday home. Also, consider upsizing to accommodate larger groups of people. Even if you don’t make use of the space yourself, you’ll be able to capitalise on the space for rental gain.
Legal implications may crop up at various stages of purchase, so make sure you are aware of the laws of the land, especially when buying abroad. For example, the property market in Thailand is problematic for overseas buyers, who are subject to restrictions on who can own land and property. Even closer to home, places like St Ives in Cornwall have a ban in second homes to protect local businesses from off-season financial droughts.
Another important factor to consider is the availability of transport links. For personal use, it is simply much easier to get to and from your holiday home for an impromptu weekend break if there is a train station or airport nearby, or a good car rental service. Also, consider the location with regards to the proximity of shops, restaurants, and bars and – if worse was to come to worse – a hospital!
Finally, you may want to consider whether timeshares or joint-ownerships might be a better option for you. Buying with friends or family will open the door to many more options at higher price points, in prime locations all over the world. Also, at higher purchase costs, you can expect to pay less in terms of maintenance costs. If there are large service charges or ground rents, dividing up the cost will save you a great deal to invest elsewhere… like buying flights to visit!
Top tips from the above:
- Be aware of the local market if buying to let. This includes pricing and USPs like sea views or extras like swimming pools or tennis courts. This will help you know where to position yourself in the local property arena
- Get savvy with local property laws. Are you allowed to purchase on your passport?
- Make sure you can get to your new holiday home easily – transport links are an important factor to consider
- Joint ownership might be right for you – minimise the maintenance cost and maximise the money you invest
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