Holiday Let in Europe as a business?
Discussion
Does anyone on here let abroad as a business? If so where, and what % yield do you get?
We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
98elise said:
Does anyone on here let abroad as a business? If so where, and what % yield do you get?
We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
If you're really looking for an international business, instead of a tax-deductible holiday home, have you considered that your'e potentially swapping a business in a country where you speak the language and understand the law for one where you may not.We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
So said:
98elise said:
Does anyone on here let abroad as a business? If so where, and what % yield do you get?
We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
If you're really looking for an international business, instead of a tax-deductible holiday home, have you considered that your'e potentially swapping a business in a country where you speak the language and understand the law for one where you may not.We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
I should also add that I will be retiring from my 9-5 so will have the time to commit to it as a business.
The original plan was to continue with more BTL property but I now want to switch to either holiday let's, or student accommodation.
If the holiday let's work then I may well move to that country. I'm currently learning Spanish, but for other countries I could just talk loudly and slowly
98elise said:
So said:
98elise said:
Does anyone on here let abroad as a business? If so where, and what % yield do you get?
We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
If you're really looking for an international business, instead of a tax-deductible holiday home, have you considered that your'e potentially swapping a business in a country where you speak the language and understand the law for one where you may not.We're aiming to get out of residential BTL entirety in the next year, so will have funds looking for a home. I'm also aiming to exit the rat race next year so don't mind something that yields more than BTL but needs more input.
We normal rent villas on holiday. The most recent one was a place in Corfu (recommend by other PH members) and while it was really nice, it was very expensive. It was also very popular and didn't seem short of renter's. Given that it was costing well over a couple of k for 10 days it seemed like a good business for the owner.
We would be looking for something similar, is a decent sized villa with private pool.
I should also add that I will be retiring from my 9-5 so will have the time to commit to it as a business.
The original plan was to continue with more BTL property but I now want to switch to either holiday let's, or student accommodation.
If the holiday let's work then I may well move to that country. I'm currently learning Spanish, but for other countries I could just talk loudly and slowly
I cannot help but think, though, your desire to do this has its basis in something other than sound business analysis. Those people I've known who have done it have found their profitability eroded by the amount of time they've needed to spend on location testing the pool and ensuring that the local restaurants are maintain appropriate quality standards.
I am sure you'll forgive me if I have been unduly cynical.
It is very difficult to manage a business remotely - no matter what that business happens to be. The key to making this work is making sure that agents and personnel that you will need to appoint to look after your business on your behalf are trustworthy, honest and have a good reputation.
The one big issue overshadowing all of this is what the relationship between the UK and EU will be after Brexit. We just don't know how European countries will react to UK nationals holding properties in their countries - especially if the break up is acrimonious.
The one big issue overshadowing all of this is what the relationship between the UK and EU will be after Brexit. We just don't know how European countries will react to UK nationals holding properties in their countries - especially if the break up is acrimonious.
Eric Mc said:
It is very difficult to manage a business remotely - no matter what that business happens to be. The key to making this work is making sure that agents and personnel that you will need to appoint to look after your business on your behalf are trustworthy, honest and have a good reputation.
The one big issue overshadowing all of this is what the relationship between the UK and EU will be after Brexit. We just don't know how European countries will react to UK nationals holding properties in their countries - especially if the break up is acrimonious.
It had crossed my mind, but the Tory government, and certainly the next Labour government are anti BTL (Certainly for private individuals) so I don't expect it to be any worse!The one big issue overshadowing all of this is what the relationship between the UK and EU will be after Brexit. We just don't know how European countries will react to UK nationals holding properties in their countries - especially if the break up is acrimonious.
I expect to have a local agent manage the property for me initially. If' it's viable as a business then I would move out there and take a more active role.
I'm very much in the early stages of analysis and planning at the moment, but I expect to retire this time next year.
Edited by 98elise on Sunday 31st March 13:53
Eric Mc said:
It is very difficult to manage a business remotely - no matter what that business happens to be. The key to making this work is making sure that agents and personnel that you will need to appoint to look after your business on your behalf are trustworthy, honest and have a good reputation.
The one big issue overshadowing all of this is what the relationship between the UK and EU will be after Brexit. We just don't know how European countries will react to UK nationals holding properties in their countries - especially if the break up is acrimonious.
Eric’s first point is dead right. We had a place in Spain in 2000, we did not want to just hand it over to an agent for a large fee. But, inevitably anyone willing to do cleaning is unlikely to be switched-on for meeting and greeting and managing problems. Or vice-versa. Not many agents are good at both aspects either. The one big issue overshadowing all of this is what the relationship between the UK and EU will be after Brexit. We just don't know how European countries will react to UK nationals holding properties in their countries - especially if the break up is acrimonious.
We have lived in France since 2005 doing pretty much as the OP suggests with 3 purpose-built houses but since the rise and rise of AirBnB etc,, business has become less easy as people tend to want to visit cities for a few days, rather that spend a couple of weeks Saturday to Saturday.
On Eric’s second point, I believe he is wrong. Brits have owned villas in the south of France since the 1920’s. Providing you are able to pay your way, you will be just as welcome as the Aussies, New Zealand and American people who currently live in Europe.
Beware of agents remembering to charge you for everything, but 'forgetting' that your villa was occupied for some of the time that you thought it was vacant, and 'forgetting' to pass on rental income.
Also, be prepared to pay a premium for everything that you cannot source directly - i.e. everything, when you're not there.
Yields for holiday lets can be very good, but the aggravation is high too.
Also, be prepared to pay a premium for everything that you cannot source directly - i.e. everything, when you're not there.
Yields for holiday lets can be very good, but the aggravation is high too.
Madness unless you have the right expectations. If you are looking to buy somewhere that you will make use of and use rental to subsidise the costs, then it's worth considering. If you are looking to manage a BTL remotely with expectations that you will earn more than you would in the UK, you are likely to be disappointed, unless you get lucky.
Anyone done this with long term rentals to local residents? I've seen apartments in some large Spanish cities (residential areas, not touristy) for 25-40k, which seem to have 12-16% yields.
There aren't many mind you, perhaps 5 in the right area per location, and most are a bit grotty, but the standard of those on the rental market means they'd need little work or investment.
I've heard areas of Lisbon can achieve 15-22% yield but the apartment values themselves are significantly greater. With the lower costs of those in Spain it'd be easier spreading the risk over a few.
Maintenance costs tend to be very low, sure an agent will take 15% to manage them but otherwise why is this a bad idea?
There aren't many mind you, perhaps 5 in the right area per location, and most are a bit grotty, but the standard of those on the rental market means they'd need little work or investment.
I've heard areas of Lisbon can achieve 15-22% yield but the apartment values themselves are significantly greater. With the lower costs of those in Spain it'd be easier spreading the risk over a few.
Maintenance costs tend to be very low, sure an agent will take 15% to manage them but otherwise why is this a bad idea?
We have a villa in the neighbouring island of Lefkada since 2005.
It has made a small profit each year from rentals. Certainly not a business. We see it as a way to cover the costs and keep it ready for family use. These small profits are generally wiped out every few years with maintenance projects.
To be squeeky clean and have no risk of problems with the authorities we had to set up a Greek sole trader business to run the villa rentals through and obtain a Tourism licence for the villa.
This way all VAT and local taxes are accounted for correctly (and actually end up in Greece which is nice).
You would need a Greek accountant for this work. Also the A1 form arrangement may cease to work for us in the future, leaving you exposed to TEVE (Greek National Insurance).
Its an awful lot of hassle for not a lot of financial gain.
Bookings..... Where would you get these from?
It has made a small profit each year from rentals. Certainly not a business. We see it as a way to cover the costs and keep it ready for family use. These small profits are generally wiped out every few years with maintenance projects.
To be squeeky clean and have no risk of problems with the authorities we had to set up a Greek sole trader business to run the villa rentals through and obtain a Tourism licence for the villa.
This way all VAT and local taxes are accounted for correctly (and actually end up in Greece which is nice).
You would need a Greek accountant for this work. Also the A1 form arrangement may cease to work for us in the future, leaving you exposed to TEVE (Greek National Insurance).
Its an awful lot of hassle for not a lot of financial gain.
Bookings..... Where would you get these from?
alfabeat said:
We have a villa in the neighbouring island of Lefkada since 2005.
It has made a small profit each year from rentals. Certainly not a business. We see it as a way to cover the costs and keep it ready for family use. These small profits are generally wiped out every few years with maintenance projects.
To be squeeky clean and have no risk of problems with the authorities we had to set up a Greek sole trader business to run the villa rentals through and obtain a Tourism licence for the villa.
This way all VAT and local taxes are accounted for correctly (and actually end up in Greece which is nice).
You would need a Greek accountant for this work. Also the A1 form arrangement may cease to work for us in the future, leaving you exposed to TEVE (Greek National Insurance).
Its an awful lot of hassle for not a lot of financial gain.
Bookings..... Where would you get these from?
Bookings would be through home away. If it's not possible to turn a profit then I won't bother. This is pure business not a holiday home.It has made a small profit each year from rentals. Certainly not a business. We see it as a way to cover the costs and keep it ready for family use. These small profits are generally wiped out every few years with maintenance projects.
To be squeeky clean and have no risk of problems with the authorities we had to set up a Greek sole trader business to run the villa rentals through and obtain a Tourism licence for the villa.
This way all VAT and local taxes are accounted for correctly (and actually end up in Greece which is nice).
You would need a Greek accountant for this work. Also the A1 form arrangement may cease to work for us in the future, leaving you exposed to TEVE (Greek National Insurance).
Its an awful lot of hassle for not a lot of financial gain.
Bookings..... Where would you get these from?
The place I stayed in Corfu must be turning a profit. It was a very nice place but 2-300 per night and seemed to be very busy with bookings. The owner was always on hand to deal with problems so it seemed to be his main income.
Same goes for the places we like in Orlando. The places we want to stay in are always booked up well in advance. We're going to Orlando this year and finding a villa of the spec we wanted was neat impossible. When you look at their available dates there is almost nothing! One person in particular had 3 high end (for a renrtal) properties, and were booked solid.
The properties in Orlando would be about 300-400k to buy and were let at about 1k per week.
98elise said:
Bookings would be through home away. If it's not possible to turn a profit then I won't bother. This is pure business not a holiday home.
The place I stayed in Corfu must be turning a profit. It was a very nice place but 2-300 per night and seemed to be very busy with bookings. The owner was always on hand to deal with problems so it seemed to be his main income.
Same goes for the places we like in Orlando. The places we want to stay in are always booked up well in advance. We're going to Orlando this year and finding a villa of the spec we wanted was neat impossible. When you look at their available dates there is almost nothing! One person in particular had 3 high end (for a renrtal) properties, and were booked solid.
The properties in Orlando would be about 300-400k to buy and were let at about 1k per week.
My guess is that you are bored with UK BTL, frustrated with the government's tax changes or don't like the look of the political environment. Maybe all three. But there are likely to be as many challenges in another country. Think about how much you've learned over here and then contemplate going through the same learning process somewhere else - when you don't live there.The place I stayed in Corfu must be turning a profit. It was a very nice place but 2-300 per night and seemed to be very busy with bookings. The owner was always on hand to deal with problems so it seemed to be his main income.
Same goes for the places we like in Orlando. The places we want to stay in are always booked up well in advance. We're going to Orlando this year and finding a villa of the spec we wanted was neat impossible. When you look at their available dates there is almost nothing! One person in particular had 3 high end (for a renrtal) properties, and were booked solid.
The properties in Orlando would be about 300-400k to buy and were let at about 1k per week.
It's much easier to make money (or perhaps not lose it) where you are close enough to keep control of things.
I think the main issues with having a BTL overseas and trying to run it as as pure business is how short "the season" is so the return you need from quarter of the year to cover the full years costs.
The other issue and one which is bound to change in the coming years is the taxation and potentially not understanding the rules.
Already many Countries see Brits as a ready source for additional taxes, I've one friend who bought a new place in Rhodes as a BTL, plus holiday home, and I've never seen him so worried/stressed by what's happened to him.
A couple of examples which are almost laughable; he bought a new build villa (1 or 3 or 4 identical) the others were bought by Greeks/other Europeans but all houses identical.
- a few years later he was "taxed for having a swimming pool"
- the tax was backdated to when it was built.
- he was fined for not having paid the correct tax.
- a couple of years on (so 5years after he bought the villa) it was discovered that the pool was over 6ft deep in the deep end, so that was an additional tax!
- that additional tax was back dated to when he bought the villa.
- he was again fined for not having paid the correct tax!!
- the villa has a car port, to keep cars in the shade.
- suddenly (just after the 2nd pool tax) he was sent a tax on his "garage", his lawyer argued this and they settled that it was a car port, he was taxed and fined for non payment of the "car prot tax"
- a year or so later he received another tax demand as the tax office had realised the car port was a double car port so more tax and fine!
Both car port and swimming pool were included in full detail on the planning consent and all four villas are identical, surprise surprise the other 3 have not had the same issues/taxes/fines etc!!
The other issue and one which is bound to change in the coming years is the taxation and potentially not understanding the rules.
Already many Countries see Brits as a ready source for additional taxes, I've one friend who bought a new place in Rhodes as a BTL, plus holiday home, and I've never seen him so worried/stressed by what's happened to him.
A couple of examples which are almost laughable; he bought a new build villa (1 or 3 or 4 identical) the others were bought by Greeks/other Europeans but all houses identical.
- a few years later he was "taxed for having a swimming pool"
- the tax was backdated to when it was built.
- he was fined for not having paid the correct tax.
- a couple of years on (so 5years after he bought the villa) it was discovered that the pool was over 6ft deep in the deep end, so that was an additional tax!
- that additional tax was back dated to when he bought the villa.
- he was again fined for not having paid the correct tax!!
- the villa has a car port, to keep cars in the shade.
- suddenly (just after the 2nd pool tax) he was sent a tax on his "garage", his lawyer argued this and they settled that it was a car port, he was taxed and fined for non payment of the "car prot tax"
- a year or so later he received another tax demand as the tax office had realised the car port was a double car port so more tax and fine!
Both car port and swimming pool were included in full detail on the planning consent and all four villas are identical, surprise surprise the other 3 have not had the same issues/taxes/fines etc!!
nav2014 said:
Anyone done this with long term rentals to local residents? I've seen apartments in some large Spanish cities (residential areas, not touristy) for 25-40k, which seem to have 12-16% yields.
There aren't many mind you, perhaps 5 in the right area per location, and most are a bit grotty, but the standard of those on the rental market means they'd need little work or investment.
I've heard areas of Lisbon can achieve 15-22% yield but the apartment values themselves are significantly greater. With the lower costs of those in Spain it'd be easier spreading the risk over a few.
Maintenance costs tend to be very low, sure an agent will take 15% to manage them but otherwise why is this a bad idea?
Yes I have "some" experience of this but only in Ski resorts, the yields tend to be a lot lower than weekly lets (about half) but then there are no additional costs of changovers, the tenants don't expect the same level of quality, there's virtually no day to day involvement needed by the owners, the full seasons rent is paid in advance, the rent doesn't include bills (water, electric internet, taxe d'habitation etc), agents margins are usually 5/15% There aren't many mind you, perhaps 5 in the right area per location, and most are a bit grotty, but the standard of those on the rental market means they'd need little work or investment.
I've heard areas of Lisbon can achieve 15-22% yield but the apartment values themselves are significantly greater. With the lower costs of those in Spain it'd be easier spreading the risk over a few.
Maintenance costs tend to be very low, sure an agent will take 15% to manage them but otherwise why is this a bad idea?
In some resorts there has been a growing market in Summer Season bookings as well as the traditional Winter Season bookings.
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