Purchasing A Holiday Home?

Investing in a holiday home offers the allure of escaping everyday life while also potentially earning income. However, buying a property that is not your primary residence requires careful consideration beyond your own emotional attachment, so it is crucial to evaluate practical aspects and financial implications in order to make a sound investment decision.

In this blog, we will explore key considerations for purchasing a holiday property, providing you with insights to help you navigate this significant investment and strike a balance between personal enjoyment and a healthy financial return.

1. Usage and Investment

It is important to reflect on how frequently you would use the holiday home. Study your past calendars in order to gain an estimate of the amount of time you would have previously spent there. While unexpected events may disrupt your plans, owning property generally proves to be a sound long-term investment due to rising property values.

2. Financing

If buying the property outright is not feasible, consider exploring financing options. Determine how much you can borrow, the deposit amount, and ensure you have a plan for making mortgage repayments. If you intend to rent out the property, inform the mortgage company to secure a mortgage that allows for rentals. Professional holiday rental management agents, like Henley Holidays, can assist in estimating potential rental income and provide necessary information for mortgage approval.

3. Additional Costs

Consider other expenses such as insurance, utilities, and maintenance. It’s important to set aside funds for unexpected expenditures in order to avoid financial strain.

4. Financial Returns

For most holiday property owners, the main goal in investing is that the property appreciates in value and generates a substantial income. While the property can serve as a personal retreat, it should also prove to be a financially rewarding venture. If your intention is to finance the property through holiday rentals, it’s important to focus on showcasing a broad appeal. The more popular and attractive your property is to a larger pool of holidayers, the higher the likelihood of guests being willing to pay for their stay and becoming repeat customers.

5. Location and Area Appeal

Location and proximity to amenities and activities are of paramount importance and greatly influence booking trends. The general public seeks a holiday experience where they don’t have to drive long distances or rely on transportation for everyday needs. Take the Snowy Mountains for example, guests are attracted to properties that are conveniently located near shops and restaurants in town, or are up on the mountain for biking and skiing.

For those that own rural properties, while they may offer picturesque views and a sense of privacy, they can be located far from town and pose challenges such as unsuitable roads and limited availability of cleaners. In these cases, it may be worth considering exploring long-term rentals with permanent tenants as a more viable option.

6. Property Appeal

Pay attention to the visual appeal and key selling points of your holiday rental. Professional photography and videography will enhance the property’s online presence and can highlight features such as scenic views, indoor entertaining, outdoor spaces, and pool or spa facilities.

7. Furnishing

Consider whether the property comes furnished or if you need to purchase it separately. Opt for versatile furniture solutions to accommodate different variations of guests. It’s also a great idea to avoid using personal items of value and focus on providing practical items that suit the holiday rental and location.

8. Maintenance and Servicing

Determine how the property will be maintained. This may include hiring services such as mowing and ground maintenance, as well as handyman and cleaning services.  You may want to consider hiring the services of a holiday rental managing agent who can handle guest needs and all property upkeep. Agencies like Henley Holidays can provide these comprehensive services, ensuring a hassle and stress-free experience for both the owners and guests.

9. Seek Expert Advice

Consult with real estate agents and holiday rental management agents for valuable insights. They can offer local knowledge, market analysis, and advice on property value, styling, and rental income potential.

Purchasing a holiday property can be a rewarding endeavour, offering a sanctuary for relaxation and an avenue for generating income. By carefully considering these factors, you can ensure that your holiday home fulfills both your personal desires and financial objectives, making it a cherished retreat for years to come.

If you are considering your options, please do not hesitate to contact the friendly team at Henley Holidays on 02 6457 2504 or visit henleyholidaysjindabyne.com.au who can provide you with an accurate valuation and help guide you through the holiday property management process.