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how to start a holiday let business

Whilst owning a holiday cottage can be a financially rewarding and exciting venture, it can be incredibly daunting knowing where to start and what to do. To help you on your holiday letting journey, we’ve summarised the key points on how to start a holiday let business.


How to start a holiday let business

You need to carefully think about the holiday cottage you will purchase if you don’t have a second home to let already, what’s needed to prepare it for guests, how to run your holiday let and how you’re going to market and advertise it.

Use the quick links below to read about a particular topic, or continue reading for our complete guide.


What to know when buying a holiday home

How-to-start-a-holiday-let-business-views

The best place to start is understanding what potential guests look for when booking a holiday home, and what they most enjoy when staying, to make sure everyone has an enjoyable experience.

With that in mind here are a few key points to consider when thinking of buying a holiday cottage.

Where to buy a holiday home

As with buying any property, location is key. So, choosing where to buy a holiday cottage is one of the most important decisions you will have to make in ensuring your holiday home’s success.

If you want your holiday home to be busy all year round, then it makes sense to choose a popular location with an active tourist market.

Our research shows that the most popular locations are found along the coast, preferably with sea views, on the water or within close proximity to the beach. The other most sought-after holiday cottages are in the countryside.

With the scenic countryside, rugged coastline and thriving tourism industry all in abundance, South Devon attracts many visitors every year.

For more insight on purchasing a holiday let property in the area, read our guide on where to buy a second home in South Devon.

Who is your ideal guest?

Another important thing to think about is what audience you’d like to attract. Consider who your property is suited to and who your ideal guest would be.

Every target audience has their own set of preferences and requirements. So naturally, the area and location of your holiday let will determine the type of guests you will cater to. Think about why your property would suit them, what they’d like from their holiday and who they want to share their holiday with.

  • If you’d like to cater for families or large groups of guests, an outstanding choice would be a property at a seaside locationwith quick and easy access to the beach or lively coastal town.
  • Some self-catering holidaymakers are looking for the vibrancy and convenience of being in the middle of a bustling town. Having an apartment or easy lock up and go, may be more suited to couples or those looking for the flexibility of short breaks.
  • A holiday cottage in the countrysideor on a peaceful farm, all with easy access to the coast and countryside may appeal to a select type of guest more interested in outdoors activities or walking holiday.
  • Not to forget that any of these potential guests could be pet-owners and are looking for the ideal dog-friendly getaway.

It’s naturally worth looking at what else is out there and identifying if there is a niche that isn’t being filled in the local area.

Type of property

Have you considered the type of property that would best suit a successful holiday let business? It goes without saying that the more rooms your home has, the bigger earning potential you have.

Having a cosy two-bed cottage, could earn on average £17,000* per annum, whereas a property with five or more bedrooms fetches in excess of £65,000 each year.

There has also been a growing market for unusual properties that offer an experience that is out of the ordinary. With quirky properties earning an average of £31,000 per year.

Glamping is another form of accommodation that has seen an uplift of 45%, with owners earning an average of £17,000 – as much as a two-bed property.

Considering this information, you may be able to invest in a real gem, different to what would normally be the obvious property type and can yield fantastic results.

Close to amenities

Choosing a holiday let in a location with plenty of attractions like shops, restaurants and other fun things to do is a great way for guests to enjoy their holiday experience.

If possible, pick somewhere that stays open all-year-round as this is important for increasing your chances of a consistent income during the off-peak months.


How to get your property ready for letting

Furnishing, decorating and features

how to start a holiday let business furnishings

With an increasingly competitive market in self-catering holiday cottages, guests are becoming far more discerning when choosing where to stay. In order to make your property enticing to guests, furnishings and décor are key, not just for adults and children but pets too!

It is advisable to equip and furnish your holiday cottage to the highest standard. It pays to invest in quality pieces which add comfort and enhance the guest’s experience.

For more decorating ideas and tips from the experts, read more about the top 10 Devon brands for styling your home’s interior or take a look at our comprehensive blog on how to furnish a holiday let.

Include additional features in your holiday let

Including additional features can do wonders in increasing your booking rate. Having just a few extra amenities could mean a notable increase in sales.

In our experience, the most popular property features guests look for are:

Hot tub cottages

Hot tubs are a firm favourite with holidaymakers, and it’s a trend that is rapidly growing in popularity. Bookings for holiday cottages with a hot tub are up 39% compared to 2021. Read our hot tub guide for holiday lets for more information on the benefits of providing this luxury feature for guests.

Holiday lets with WiFi

Now more than ever, people are more likely to work from home, even on holiday. So it’s no surprise that 29% of people rate fast and secure WiFi as a priority when booking a getaway. Set up a safe and speedy WiFi for a simple way to increase your holiday let income.

Sustainable staycations

Consider environmentally friendly features, big or small, that make a positive impact

From using renewable sources to sourcing local and providing an electrical car charging point for guests, these factors are key for the 26% of Brits who stated they’re more likely to book a UK break due to environmental concerns.

Cottages with a log burner or open fire

Holiday lets with a log burner or open fire can generate a good additional income during the winter months.

Properties with parking facilities

Having a parking space at a holiday cottage is often a key decision maker for guests during their booking process. A property that provides any sort of parking facilities, be it garage, private parking space or car park permit is a valuable asset to any property.

Holiday homes with outdoor space and gardens

A holiday let with some form of outdoor space is a key factor in securing bookings. Be it a garden, terrace, patio or balcony, having an area where they can make the most of the warmer weather is a top priority for guests.

While not all properties have the luxury of rolling green lawns and acres of grounds, there are many ways to optimise your holiday home’s outdoor living space in order to attract more guests and command a higher rate of return.

Should my holiday home be dog friendly?

A pet-friendly property is one of the most searched features for guests booking a holiday. With more people working from home, more people are owning dogs. According to Sykes Staycation Index, 35% of 2022 bookings include dogs, rather than the recorded 33% in 2021.

With almost a third of British people taking their pets on holiday, it’s worth looking into whether it would be worth you making your holiday cottage dog-friendly. Read through our blog which covers the pro’s and con’s of allowing pets in your holiday home.

how to start a holiday let business dog friendly


Holiday let rules and regulations

A holiday let is subject to specific legal requirements. These rules and regulations are in place to not only protect your guests, but you and your holiday let business. While at first look it may seem complicated, once you understand them and put measures in place, it is relatively straightforward.

Holiday let tax rules

how to start a holiday let business

Understanding the legalities involved and knowing what type of holiday let business you qualify as is your first step.

  • Your holiday let must be actively promoted and let commercially, with the intent of making a profit.
  • Your property must be available for commercial holiday letting to guests for at least 210 days (30 weeks) per year.
  • If your Furnished Holiday Let is rented out by the same person for more than 31 days, there shouldn’t be more than 155 days (+22 weeks) of this type of ‘long term’ occupation per year.
  • Your property must be rented out as holiday accommodation to the general public for a minimum of 105 days (15 weeks) out of the 210 days you have made it available.
  • Your property needs to be adequately furnished and equipped to qualify as a Furnished Holiday Let.

Fortunately, there are tax relief schemes available for properties classed as Furnished Holiday Lets. For more information read our Furnished Holiday Let tax guide or a visit the HMRC HS252 help guide for more information.

Holiday let council tax and business rates

No matter how you intend to use your property, owning a second home will require you to pay council tax or holiday let business rates. The difference in which you pay comes down to how long your property is available to let to guests.

If your holiday home is in England and available to let for 20 weeks (140 days) or more in the calendar year, it will be considered a commercial property and will be valued for business rates.

To understand in a bit more detail the difference between the two, as well as what you could expect to pay, review our guide to holiday let business rates and council tax.

There is however a positive side to this. Owners of some Furnished Holiday Let properties pay no council tax or business rates. This is because their property qualifies for Small Business Rates Relief, providing 100% exemption.

Read on for more details, or visit the HMRC website for information on HS253 Furnished Holiday Lettings guide or Small Business Rate Relief.

Holiday let mortgages

Whether you already own your holiday let property or intend to buy a self-catering cottage to let, it is imperative to inform your mortgage lender. If you intend to take out a mortgage, this will influence the type of loan as well as which lender to choose.

A holiday let mortgage is specifically designed for an owner to borrow money in order to purchase a property to let out on a short-term basis for guests. Understanding the difference between the types of mortgages available to you as a holiday home owner is imperative.

To understand the various qualifying requirements, read our guide to holiday let mortgages.

Holiday home insurance

Holiday let insurance is different to your normal home insurance schemes. It’s a specialist cover that protects you from the risks that come with renting out your property on a short-term basis.

While it isn’t required by law, having this form of cover could make sure you aren’t exposed to any unfortunate events and unexpected costs. All our owners are required to ensure that they have public liability insurance in place alongside their holiday home insurance cover.

Planning permission for holiday lets

If you already run a holiday let business or become the owner of one, then you don’t need planning permission since there is no change of use.

However, planning permission may be applicable if you are letting your property to guests for the first time, converting an existing structure or unused land. It’s also worthwhile checking that there are no clauses regarding commercial letting in your lease or conveyancing agreement. Read our blog on holiday let planning permission for more information.

Health and safety

In order to make sure your property is suitable as a holiday let, it is advisable to do an overall risk assessment to make sure you have your health and safety regulations covered. By law, you are required to have an annual gas safety check, PAT testing for electronics and a valid fire risk assessment.

These are just a few of the key considerations to be aware of. Read our blog on holiday let rules and regulations or download our Owner Property Safety Guidance for information on the legal requirements for letting your holiday property.


How much money can you make from a holiday let business?

Pricing your holiday cottage

Working out a pricing strategy for your holiday let is necessary in order to gain maximum profit and maintain good occupancy levels throughout the year. Having an inflated price is likely to deter guests from booking but charging too little can negatively impact on your earnings. Your ability to charge will be directly related to a number of contributing factors.

The value, size and geographic location of your holiday cottage, together with the number of guests you can host, form the basis of setting your pricing.

It’s important to consider the current demand in your area, as well as what similar properties are charging. Offering special low-season rates , last minute bookingshort breaks will all contribute to better booking potential and more profit.

Our New Property Consultants can visit your property and give a no-obligation assessment of its rental potential, the income you can expect and the costs that it will incur.

Our expert team understand the market place in South Devon, and can offer expert advice on what pricing strategy will help to secure your maximum potential income when you start your holiday let business.

Cost of running a holiday home

Making sure that your incomings are more than your outgoings may seem logical, but it is important to understand all the costs involved in running a holiday let. According to our research, the average cost of running a holiday let is £11,500 – including things like council tax, utilities, cleaning costs and property maintenance.

Read our extensive guide on the cost of running a holiday let in order to make sure you have a detailed understanding of what this involves.

Advertising and marketing

Ensuring your property is correctly advertised and promoted to the right market is key to driving bookings and income. Choosing to let your property with an agency such as Coast and Country Cottages offers extensive marketing and advertising support. We make sure your property is put in the spotlight, with listings on both the Coast & Country Cottages and the Sykes Cottages websites.


Running your holiday let business

While it may seem relatively straightforward, running a holiday let can be time consuming, challenging and complex. Understanding and managing the practicalities involved in running a holiday let is key to its success.

Managing holiday home changeovers

how to start a holiday let business changeover

Organising and managing the changeover between bookings is an important and time critical aspect of your holiday let, and it’s imperative to make sure that you get it right. From cleaning and laundry, to maintenance and key collection, every holiday home will be different and have its own unique complexities.

Understanding the operational side of your holiday let business may help you determine whether to be ‘hands on’ when managing your property or use an experienced agency like Coast & Country Cottages to run the day-to-day management of your holiday property.

Read our blog on choosing the right holiday home management solution to find out which is the best choice for your situation.

Cleaning, housekeeping and laundry

After each booking, it’s crucial that you conduct a thorough clean of every room in the house as well as outside spaces. General housekeeping, co-ordination of cleaning services, supply of linen and towels, property checks and maintenance are all part of the process.

Read through our blog on everything you need to know about cleaning, housekeeping and laundry in order to prepare your holiday home for guests.

Holiday home property maintenance

Guests expect a high level of service and quality in a holiday home. It is paramount to stay on top of the maintenance and upkeep of your holiday let and ensure it is in tip-top condition. It always pays to sort problems as and when the issue occurs rather than putting it off.

While some issues are easy to fix, like replacing a light bulb or tightening a loose handle, other jobs are a bit more complex and would benefit from planning, comprehensive advice and qualified tradesmen.

The winter months can be particularly hard on any home, so with a bit of planning and maintenance, winterising your holiday let can protect and prevent any unnecessary damage.

Garden maintenance

how to start a holiday let business - garden maintenance

A beautiful and well-maintained garden makes a holiday home far more attractive to guests. Whether your home has sprawling gardens or a cosy courtyard, make sure you carry out at least the basics in maintenance and upkeep. Always ensure the area is tidy of leaves and unsightly weeds, trim overgrown plants and mow the lawn.

Guest information and welcome pack

Making your guests feel welcome, comfortable and at home can go a long way. A well-presented and carefully considered welcome pack with relevant information about the property, directions on using the appliances and other similar instructions takes the hassle out of a guests stay.

Additional notes with emergency contact details, closest shops, the best eateries and convenient transportation links are always gratefully received, especially if guests are new to the area.

Extra touches like these can improve your online reviews. Read our guide on how to create the perfect guest information pack to welcome holidaymakers.


How to start a holiday let business with the help of our expert team

At Coast & Country Cottages, we pride ourselves on the outstanding local service we offer, delivering exceptional results with high levels of booking and income for our owners. We can provide support and advice on every aspect of making your investment a success, from planning and development to income forecasts and interior design.

New to holiday letting? With our tailor-made service and years of experience, we can guide and support you to ensure that when you start your holiday let business, you get the best out of your property.

Whether you have a second home for your own use that you want to pay for itself, or if you are looking for an investment opportunity, we’ll be by your side every step of the way. For more detailed information, read our blog on are holiday lets a good investment?

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If you’re looking to start a holiday letting business, the following owner guides may be useful to you:

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*Statistic provided by Sykes Holiday Letting Outlook Report 2022 and Sykes Staycation Index 2021.