Is buying a holiday home a good investment?

Investments

What could be better than having spectacular scenery and historic towns and picturesque villages on your doorstep? Investing in a holiday home in the heart of the Cotswolds can be rewarding personally and financially.

With the obvious benefits of escaping city life and connecting with loved ones, property investment can generate income, supplement savings in retirement and provide a legacy for your family.

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An ethical investment

Whilst smaller villages and towns are becoming increasingly overwhelmed with the rise in visitor numbers over peak dates, Lower Mill Estate is a sustainable, purpose-built development so there is minimal effect on the environment and surrounding communities. As the estate is self-contained, it avoids creating an off-peak ‘ghost town’ and will not price the local population out of the housing market.

Habitat First Group’s ethos is to protect and nurture the natural environment, with Lower Mill Estate being a ecological haven and flourishing nature reserve.

Investment as a holiday let

Holiday lets are an expanding market and with growing concern in the international travel industry, consumers have opted for more UK holidays, making it a great time to think about a holiday rental investment. When choosing to invest in a holiday home, location is key; owning accommodation within The Cotswolds would ensure plenty of visitors throughout the year.

Short-term holiday lets can be much more profitable than longer-term lets, given that you can charge the same for a week’s holiday as you can for a month’s long-term let. The rental yield you can obtain from a holiday let can be up to 30% greater than a standard buy-to-let annual 8% return.

Significant tax benefits

Tax benefits for holiday lets are not afforded to buy to let landlords, making a huge difference in profitability. A holiday let can be treated as a business for tax purposes, whereas a buy-to-let is regarded as an investment giving rise to investment income. Unlike the latter, owners of holiday lets can deduct the entire cost of their mortgage interest regardless of other income. Holiday lets are subject to business rates rather than council tax.

You are eligible for tax benefits if your holiday let is available for at least 210 days a year and let out for a minimum of 105 days each year. Of course, individual circumstances are unique, so professional tax and investment advice should be taken.

Choosing a trusted and reliable management agency is key to the success of any holiday let investment. Partnering with experts like Habitat Escapes, the on-site specialist for Lower Mill Estate owners, can make your property investment journey painless by providing a complete management and maintenance service.

So, whether you're looking for a personal investment, a financial gain, or looking to leave an inheritance for your children, Lower Mill Estate offers a chance to buy a luxury lakeside holiday home that ticks off everything on your property investment wish list.