Holiday Letting, Is It Safe ?

[Kez]

Hi folks,

I am a private home owner, living in a beautiful part of Rural Wales, I have never let my property before. But am drawn to do so, in the hopes of making some much needed income.

My home has a new extended part, which I live in, and an old part ( the original old cottage ) which I do use, though less frequently.


I wish to advertise the original part of the cottage as a holiday let.

However, I do not wish to advertise through an agency, preferring to advertise privately,myself.

My question is this, If I let the old annexe cottage, for long weekends, or say maximum of a week. Would I be in the same danger as a regular landlord who rents out rooms to people,long term ?

Who then often finds themselves with nightmare tenants who refuse to pay or to leave, and thus end up in court.

I have done some online research on the subject, and am most concerned about this element of letting property, as it appears, non paying tenants/ lodgers, whatever, are protected by law, and I profoundly wish to avoid the same eventuality happening to me.

Is there ~Any, secure/ legal way I can protect myself from falling into the same trap ?

I am financially unstable right now and simply ~Cannot, afford to make any mistakes.

I look forward to any advice you can give me..

Thank you ..

 

[lookinginvest]

I would assume that the regulations covering a short-term holiday let protect the landlord as much as the tenant. I could be wrong but I think the problems with tenants refusing to pay or leave are more associated with long-term arrangements? The best way to ensure you are paid is to take money upfront. If a potential tenant is not able to pay upfront then the chances of them not paying must increase?

I would take professional advice on this to protect yourself.

 

[Kez]

Thank you so much for your response, my first port of call will be Citizens Advice .....

 

[nmb]

The bottom line is that wherever there are significant potential returns there will be significant potential risks. Balancing the risk/reward ratio in your favour is the key to a long-term successful career in property investment.

 

[John Wilson]

Hi Kez.. I totally get your trepidation about letting out part of your home. I was a little doubtful when I let out a room in my home but what I found was that the folks that came to stay were really great and I never had any trouble. I now let the whole place out as short stay accommodation (and also our holiday home too) and haven't had a problem in the nearly 10 years we've been doing it.

I know you said you don't want to let using an agency but (and I don't know if you'd really consider AirBnB an agency) using AirBnB is a great way to start.

I say that because they handle all the money: they take the cash in advance of the stay and you get the payout the day after the guests arrive.

The other advantage of Air is that they provide a free host guarantee to cover damages to your property for up to $1M, for every booking.

I suggest you try it out and I think you'll be pleasantly surprised at the quality of guests you're going to host.

Happy to answer any other questions you have on the topic.

Good luck!

 

[John Wilson]

Just noticed the date of your original post Kez -- I guess you've either taken the plunge or not by now. Why not post and let us know what you decided to do, and how it went?

 

[Longterminvestor]

Maybe look at AirBnB until you find your feet and have the confidence to "go it alone" so to speak?

 

[John62]

Hi Kez.. I totally get your trepidation about letting out part of your home. I was a little doubtful when I let out a room in my home but what I found was that the folks that came to stay were really great and I never had any trouble. I now let the whole place out as short stay accommodation (and also our holiday home too) and haven't had a problem in the nearly 10 years we've been doing it.

I know you said you don't want to let using an agency but (and I don't know if you'd really consider AirBnB an agency) using AirBnB is a great way to start.

I say that because they handle all the money: they take the cash in advance of the stay and you get the payout the day after the guests arrive.

The other advantage of Air is that they provide a free host guarantee to cover damages to your property for up to $1M, for every booking.

I suggest you try it out and I think you'll be pleasantly surprised at the quality of guests you're going to host.

Happy to answer any other questions you have on the topic.

Good luck!

Hey John,
it sounds like you're an experienced AirBnB host. So far I only experienced it as a guest, but I have a question about taxes you pay on income generated through AirBnB: Starting at which amount do you need to declare it as an income and how much taxes do you pay on it? Maybe you have an answer. Thanks

 

[FWL]

Hi @John62

I assume you would need to declare this in your tax return but maybe there are costs which you could also declare to offset the rental income?

 

[lookinginvest]

I have read numerous articles which suggest that HMRC are coming after landlords who do not declare their rental income on their tax returns. Being singled out by all accounts!

 

[John62]

That's understandable. And it's probably the main point of all the critics about AirBnB. I would declare it and declare as well all the expensive. Because in the end you only pay taxes on the profit, not the revenue.

 

[Longterminvestor]

Totally agree - get an agent to look after the legal side, collecting rent, etc. It will reduce your margin but if this is your first time, probably better to be careful.