Considering holiday property or that long-awaited holiday? Here are some facts to consider.
Advantages of owning your holiday property:
- You have to apply for and register a bond.
- The increase in value of the property is a financial gain.
- You can go on holiday any time of the year.
- If you do not have a holiday planned you can let the property out as extra income. Should you not want to utilise the property in peak season, you can raise peak seasonal rent which is generally higher than any other time of the year.
- You can change the property to suit your needs.
- If you do not want to, you do not have to pay seasonally high prices for holiday accommodation.
Disadvantages of owning a holiday property:
- You are responsible for the maintenance and upkeep of your property.
- The property could stand vacant for months at a time, subject to the risk of burglary.
- Rental income could be limited to seasonal use.
- The property could be damaged by tenants and you will be left with repair costs.
- Holiday tenants could refuse to vacate the property after the agreement term, leaving you with the unsavoury task of obtaining an eviction order which could take some time and initial costs.
- Holiday tenants could change their plans, leaving you with a shortfall in income.
Advantages of renting:
- You do not carry the additional costs of rates, taxes and maintenance.
- Security and risk of burglary are not your concern.
- You can choose alternative holiday destinations every time you go on holiday.
Disadvantages of renting:
- You can only go on holiday when accommodation is available.
- You are paying someone else's bond.
- Peak seasonal accommodation rent is high.
- You may not always be able to find accommodation where you wish.
- You never own your own holiday destination, especially when you are someone who likes a specific destination.
There are both positive and negative aspects of owning and renting holiday accommodation. It is a matter of preference and financial feasibility.