What is the difference between a guest house and a hotel?

When choosing somewhere to stay, many travellers automatically think of hotels. But there are a whole host of other accommodation options available, including guest houses.

The boundaries between a guest house and a hotel can sometimes be blurred; after all, both are based on the same principle of providing accommodation to paying guests.

However, there are a number of key differences that differentiate these two types of accommodation.

 

What is a guest house?

A guest house is a private house, which provides accommodation for guests. Guest houses are usually owner-operated, with many hosts actually living on the premises. The vast majority of UK guest houses have no more than 5 bedrooms and offer a distinctly home-from-home feel.

 

What is a hotel?

A hotel also caterers for customers who require overnight accommodation. However, the hotels are typically bigger than guest houses, have more facilities, and can accommodate more guests. They can often hold hundreds of guests at any one time and are frequently part of larger chains.

 

What are the differences between a guest house and a hotel?

The key differences between a guest house and a hotel are:

 

Size

Guest houses tend to be a lot smaller than hotels. Even though they can accommodate fewer people, guests still enjoy a comfortable stay and appreciate the many personal touches that come with guest house stays.

As guest house owners usually live on the premises, they are incredibly attentive and often go above and beyond to ensure that their guests have a great stay.

 

Price

Generally speaking, guest houses are cheaper than hotels. They can also work out more cost-effective for guests staying for longer periods as they may have access to facilities such as kitchens to cook meals in rather than always dining out, as well as clothes washing facilities.

 

Ownership

Across the hospitality sector, you will find that the vast majority of guest houses are run as family businesses and tend not to have a reception desk or a concierge service. This means guests usually receive a more personal level of service.

On the other hand, hotels are commercial businesses that employ full-time staff with dedicated roles, operate around the clock and always have lots of facilities and amenities on-site to enhance their guests’ stay.

 

Facilities

Guest houses tend to have comfortable but basic, home-style facilities. Hotels, on the other hand, typically have more facilities, including in-room mini-bars, bar and restaurant areas, gyms, and more.

 

Buying a guest house or hotel?

If you’re considering buying a commercial property, such as a guest house or hotel, it’s important to speak to someone experienced in the sector to ensure that you are aware of all the funding options available to you.

 

Get in touch to speak to one of our skilled and experienced team. We are always on hand to answer any of your queries regarding commercial mortgages.

 

 

 

How to start a guest house business

Running a guest house cannot only be extremely profitable, but it is also a life-long dream for many people. And, with more of us holidaying in the UK, there’s never been a better time to start a guest house business.

Although exciting, establishing any business can be incredibly daunting. So, before you start your guest house business, it’s important that you familiarise yourself with the process.

Is running a guest house for you?

First and foremost, you should ask yourself whether or not this is the right decision for you. After all, running a guest house is a huge commitment and it’s important that you understand what to expect from the role. You should spend some time researching the market to determine whether or not there is a gap, or demand, for what you plan to offer.

Find a property

To run a guest house, you’ll of course need to have the house itself. Think about where you want to set up your guest house business –  location is everything and it’s important you set up your business in a place that people want to visit.

Many people choose to buy an existing guesthouse as it will be all set up and ready to go, rather than having to convert a property.

Research the market

It’s important to consider the market to ensure there is a demand for your offering. Is there a demand for a guesthouse in the area? Who is likely to stay at your guesthouse? What services and amenities will they be looking for?

Develop a business plan

The next step to starting a guest house is to develop a business plan. A business plan is vital when it comes to starting a guest house, as it will outline the measures you will need to take to make your business a success. It’s also important if you are making a credit application to obtain funding for your guest house. If you’re applying for a commercial mortgage, for example, your lender will also ask to see a business plan.

Having a sound business plan will help to keep you on track when it comes to achieving your business goals and, of course, it will also give you a clear indication into operating costs.

Generating interest in your guesthouse

If you’re starting a guest house from scratch, you will need to start by drumming up as much interest as possible in your new business venture.

You can do this by…

  • Investing in a website showcasing your guest house – integrating a booking system within your website is also a great idea.
  • Create a customer database from the offset.
  • Hire a marketing team to design a powerful logo and any other marketing materials you might need.
  • Advertise using all available platforms.

Ensure you meet regulations

If you are starting a guest house in the UK, you will need to comply with all fire safety laws and legalities. If you are altering a property or building a guest house from scratch, you will also need to obtain planning permission.

Why choose Stewart Hindley for your guest house finance?

If you’re considering buying a commercial property such as guest house, it’s important to speak to someone experienced in the sector to ensure that you are aware of all the funding options available to you. Get in touch to speak to one of our skilled and experienced team. We are always on hand to answer any of your queries regarding guest house commercial mortgages.

Thinking about buying a B&B or Guest House in Scotland?

Why bed and breakfast purchases in Scotland are different.

There is a considerable difference when you come to purchase a B&B in Scotland, or a guest house. For instance, Scotland has its own judicial and legal system which differs from the rest of the UK which often results in confusion, expense and sometimes frustration when compared to English law and procedures.

One of the most notable is the commercial land tax known in England as SDLT (Stamp Duty Land Tax) whereas in Scotland this is known as LBTT (Land and Buildings Transfer Tax) which is charged at a higher rate to comparable SDLT. Another higher cost are legal fees which are generally 50% higher than comparable English legal fees for commercial conveyancing.

And it doesn’t stop there. Energy Performance Certificates have different ratings in Scotland to those in England and can often lead to confusion as lenders will only lend on commercial properties that are EPC compliant.

And finally, Scottish lenders and other UK lenders who operate in Scotland also have different lending criteria which can be more onerous than UK lenders so nothing is a given.

We at Stewart Hindley, operate throughout the UK, and have considerable experience assisting prospective purchasers who are buying properties in Scotland with their commercial mortgage requirement.

If you are considering buying a property your first port of call should be Stewart Hindley as we’ve funded many a Scottish B&B and Guest House not only for UK wide purchases but for Scottish Purchasers too.

 

For more information please get in touch