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Buying for rental on the up - 30 June 2008

The latest figures from Holidaylettings.co.uk have shown that in increasing proportion of overseas property buyers are considering the possibility of renting their holiday home out to increase their income when they decide to buy. According to the figures, only 16 per cent of buyers were intending to rent their property out for part of the time in 2006, as opposed to 35 per cent of buyers asked the same question in 2007.

This shift in the intentions of the average overseas property buyer can be attributed to both a change in how people view their second home overseas as an investment and income generator, rather than a second home exclusively; and to the increasing need among buyers to supplement their income to make sure they can cover mortgage and running costs on one or more properties.

The last survey quoted by the specialist holiday rentals website is the 2006 Mintel report on the Market for Homes & Housing. This showed that just 20 per cent of overseas property buyers had the intention of renting out their property overseas. Holiday Lettings has said it expects that proportion to increase to one in four, or even one in three buyers in the next few years.

Previously, the site has highlighted the potential £4 billion in rental revenue that is not exploited in the overseas property market if more owners listed their properties abroad for rental.

If you are considering buying with the idea of renting out the property and generating a second income from it, there are some things that you may want to consider before signing on the dotted line. Consider the length of the rental season and how many rental properties are available already in the nearby area. Too many and you will find there are significant void periods and heavy competition, too few, and it may be because the hotels in the area are good quality and value, or that tourists to that particular location are more attracted to hotel rather than self-catering accommodation.

Holidaylettings.co.uk, part of the Rightmove group, also has a number of guides and tips for owners of overseas property who are looking to put their home to work to generate rental income. These guides include how to market your property, and how to prepare your property for rental, without losing the home touches you have put into it.

 

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