Renting Out Your Holiday Lodge

Renting out your holiday lodge is a great way to cover pitch fees and other costs and to even turn a profit. The demand for UK holiday lodges in 2021 is likely to be high due to uncertainty about international travel restrictions because of coronavirus. As people discover or rediscover the attraction of the UK as a holiday destination, the time is right to look at renting out your holiday lodge.  Here are some important things to consider before renting out your holiday lodge.

Check the holiday park rules

Does the holiday park allow commercial lets? Consult your contract with the holiday park owner to find out if you can rent out your holiday lodge on a commercial basis. It’s possible that you can hire it out to friends and family, but not for a profit. Alternatively, you may only be allowed to let your holiday home if the park management are responsible for managing the bookings. For all these reasons, it’s important to check.

Check the insurance for your holiday lodge

It’s also important to check that your holiday lodge insurance covers you for letting out your holiday lodge for a profit. You may want to consider adding extra cover for your leisure home. In any case, you must tell your insurer that you’re renting out your holiday lodge to paying guests.

Enlisting the holiday park owner to manage your holiday lodge bookings

If you have the choice whether to use the holiday park owner to manage your holiday lodge bookings, you may still want to take this option. They will charge a fee, but they will help you to prepare your holiday lodge for letting. For example, they may help with inventories and legal compliance. They may also arrange cleaning and help with maintenance.

If you’re intending to use your holiday lodge for your own holidays too, you’ll need to let the agency know of your intended dates.  Handling a holiday home rental business, however small, can be a joy, but be aware that it is a serious commitment and can take up quite a lot of time.

If you decide to handle the rental business yourself there are a number of things to consider:

Marketing – Consider a holiday lettings agency to take some of the work from your shoulders as doing it yourself can take many hours per week. Whatever you decide, you will need to provide photographs and descriptions for advertising purposes. Make sure these are high quality and honest. Put your best forward, certainly, but be aware that holiday makers come with expectations and it is better to exceed them than to disappoint.

Cleaning and maintenance – This also can be contracted out. Make sure you find a reputable and reliable company to handle this for you. If you have only one property, friends or neighbours can be useful but don’t underestimate the amount you are asking from them. Either way, it is a good idea to create an itemised and time assessed schedule for yourself or a contractor. This helps to manage your own time and to judge the performance of anyone else to whom you give the work.

Risk Assessment – It is useful to carry out a risk assessment to make sure you have made your holiday lodge, inside and outside, as safe and user-friendly as possible. This will also help in the event that you need to make a claim against your insurance.

Welcome and changeover protocols – After someone has booked their stay at your holiday lodge, what kind of landlord do you want to be? Some prefer to do everything by email with secure key pickups and others prefer the personal touch, being present to welcome guests. Think through which approach best suits you and your available time before making the commitment to rent out your holiday lodge.

Legal requirements when renting out your holiday lodge

If you rent your holiday lodge on a commercial basis then you become the landlord for your guests. This means that you need to comply with certain safety regulations. These include the following:

  • Install an effective smoke alarm and test it regularly
  • Have an up-to-date carbon monoxide alarm
  • Ensure the fire extinguisher is tested and working and there is also a fire blanket
  • Display a fire safety notice with clear instructions of what to do in an emergency
  • Get your gas appliances checked by a professional and display a ‘Landlord’s Gas Safety Certificate’ in your holiday lodge
  • Ensure your electrical wiring is checked for safety by a professional every three years and has a valid fixed electrical installation certificate
  • You may also want to carry out portable appliance testing (PAT) for electrical items such as the TV, kettle, toaster and microwave to ensure they are safe for your guests to use.

Making a profit

When deciding whether to rent out your holiday lodge, you’ll need to take into account the costs involved and the potential income that you’ll receive.  How much you can charge for people to stay in your holiday home will be determined by a range of factors:

  • Location – the demand for holiday homes in your locality and access to beaches, leisure facilities and other attractions
  • The size of your holiday lodge – how many people it can accommodate
  • Facilities at the holiday park, such as swimming pool, tennis, golf, etc
  • The time of year – prices are often higher in the school holidays and summer months. Weekend bookings can also attract a premium. 

You also need to calculate the costs that you will incur:

  • Cleaning – you will need to have your holiday lodge cleaned between bookings. Think about the minimum booking period required to cover your cleaning costs sufficiently.
  • Maintenance – general wear and tear on your holiday lodge will increase the more it is used. In addition, some refurbishment work may be needed before you start renting out your leisure home. In order to control your costs, you may want to have a maintenance contract for some of your appliances, such as your boiler. 

Paying tax on your holiday lodge rental income

The income that you gain from renting out your holiday lodge will be subject to tax, so you’ll need to inform HMRC and complete a tax return. Some of your business expenses may be tax deductible.

It can be a joy to share your leisure home with others, and we hope that this guide helps you to take a professional approach to renting out your holiday lodge.

This is a marketing article from Park Home Assist, multi award-winning providers of holiday lodge insurance. If you would like to speak to an advisor regarding insurance for your holiday lodge, please contact our friendly team in our Northampton office on 01604 946 796.

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Published – 01/07/21