Holiday Homes: A Tidy Profit For Your Rainy-Day Nest Egg?
As retirement nest-eggs go, owning a home in a holiday resort is not a bad one. You can enjoy a very decent income from the rental value of the home for as long as you wish, and if the fancy takes you it’s also possible to move into the property yourself. Having a holiday home in a special place opens up some options for you, but it also poses some questions. Below, we’ll go into those, and the answers, to give you an idea of how best to manage a holiday home.
Do I need to live in the same area as the holiday home?
There is no reason for it to be essential that you live near a home you’re renting out. It may be easier if you do – it allows you to handle check-ins and -outs, and carry out inspections – but you can by all means hire a property manager living locally to do much the same. Assuming that won’t erase all of your profits, it may be your best choice overall.
Can I afford a home in a holiday resort?
This naturally depends on how much money you have to spend – only if you’re particularly well-off could you buy a rental property in Dubai, for example. However, as the world opens up there are more and more areas that are attractive to curious tourists. Bulgaria’s Black Sea coast is stunning and increasingly popular with tourists, and houses there are much more affordable than in the UK – they can pay for themselves in short order, and then offer a great deal of profit. But buying property in a foreign country is likely going to be different to if you were going to be buying at home, and you may well feel like you need some guidance. Should this be the case, you could reach out to an overseas property expert like Simon Conn to see if you can find the answers you need so that you can go into your overseas property purchase with confidence.
How can I ensure my investment keeps its value?
Owning a property brings with it some responsibilities, and you may have to keep a keen eye on a property if you’re not living nearby (and even if you are). You’ll also have to allow for repairs, which are more or less inevitable in any home but arguably more so in a short-term rental space. Again, a property manager can help with this, but do make sure you are covered against damage to the home.
Is there anything else I need to know?
It is not essential, but is highly recommended, that you learn some of the language of any country in which you are going to buy and maintain property. It’s not uncommon for local residents to be less than happy with overseas investors buying up homes, and if you appear out of touch or indifferent to the people who live in that area for 12 months of the year it would be naive to expect neighbourly good nature from them. It will also enhance any holiday you may choose to take in the region yourself if you are able to communicate clearly.
A holiday home can be a very worthwhile investment, if it is managed properly. There are plenty of options out there for those who are interested in taking this kind of investment on.
*This is a collaborative post.
