What are the Pros and cons of owning a holiday home?

Advantages to owning a vacation home:

1. Quick escape

Most people are attracted to the idea of a second home because they can go on vacation whenever they want. Who wouldn’t want to be able to simply jump inside the car and escape from the monotony of life? You don’t have to worry about packing too much if you have a vacation home. You may travel light and at a moment’s notice knowing that you won’t forget anything to prevent you from having a great time if you just leave a few items, such as clothes, surfboards, etc. at your second home. Free Saturdays with nothing to do will never be comparable again.

2. Extremely profitable

Another compelling reason why Brits are climbing the 2nd-belongings ladder is the fact that vacation homes frequently prove to be surprisingly profitable, especially during the year’s peak seasons. People are likely to be willing to pay a premium to live in your property during the college summer vacation if, for instance, your vacation home is family-friendly (and situated in the right location).

3. Marketing is efficient

Owners of second homes can now easily list their vacation homes on websites like Airbnb and HomeAway.From an advertising perspective, they take care of the majority of the work for you; all you have to do is make sure that you’ve posted a few photos that show your vacation home in its best light and that you respond to any customer inquiries promptly.

4. Favorable tax laws and regulations

Since we are perceived as a purchasing and selling activity rather than an investment, vacation homes are subject to more advantageous tax laws than modern condo buildings. However, you can let it out to tourists so that it can reach the right part of Her Majesty’s Revenue & Customs (HMRC). As we’ve just discussed, there may be a significant financial incentive to do that in terms of yield, but some people may also opt to keep their second home entirely to themselves.

Cons of being the owner of a vacation home

1. Increased costs

As you might expect, purchasing a home in one of the most desirable areas in the UK, like Cornwall, typically entails paying “over the odds” for a holiday home. For some people, this might imply that they should settle for a less ideal location, but it doesn’t mean it will be any less interesting for them to spend time there. The more you pay for your excursion permit, the longer it will take for you to turn a profit if you want to try to add a little extra money to it. Additionally, if you wanted to use it personally, you could have to let it out during specific times of the year.

2. Securing credit.

If you want to take out a loan for your second home, you might struggle to meet the increasing number of strict affordability requirements required by lenders. Naturally, banks and building societies will need to see some convincing evidence that you will be able to pay back the loan for your second home, especially if you also have a loan for a new property.

If your vacation home is located in a region where there may be a danger of flooding, such as the Lake District, lenders may refuse to give you a loan or may require you to obtain extensive vacation home insurance coverage.

3. Loss and disruption

You should prepare yourself for potential harm and disruption if you intend to release your second home to the public (i.e., strangers). While you can take certain precautions to avoid letting anyone who will be rude and reckless inside the property, accidents can happen, and the more people who use it, the higher the risk of an accident (or malicious harm).

Disclaimer: The views expressed above are for informational purposes only based on industry reports and related news stories. PropertyPistol does not guarantee the accuracy, completeness, or reliability of the information and shall not be held responsible for any action taken based on the published information.