Large properties can be costly and difficult to maintain as homes. One way to ensure the property is managed to a high standard is to turn it into a bed and breakfast. This could help you to unlock additional funds as well as giving you the extra motivation you need to keep on top of the maintenance. Additionally you’ll get to be your own boss and have the potential to tap into large profits.
The bed and breakfast market is currently huge in the UK and is expected to grow further over the next few years. When economic troubles hit, expenditure on “staycations” typically rises as people opt to stay closer to home rather than travelling overseas. This happened between 2008 and 2009 when expenditure on accommodation in the UK rose from Â£8 billion to Â£9 billion, reflecting the impact the global financial crisis caused.
When running a bed and breakfast, it is important to be prepared for the changes in demand that you will see. You’ll have seasonal demand to deal with as well as possible unforeseen changes in economic circumstances. This is why it is crucial to keep tight control over your cash flow and ensure you have funds held in reserve. One thing you should ensure is that you choose a mortgage that will allow you to adjust payments to suit the situation.
Mortgages to open a bed and breakfast are slightly different to the usual ones you encounter when purchasing a property. This is because it is a business and there are far more conditions to take into account when deciding on the terms of the policy. You should ensure you take care when choosing one to ensure you are clear on your obligations and will be able to meet them.
One excellent feature of some bed and breakfast mortgages is the fact that repayments will adjust automatically depending on the season. This means you can pay back a higher amount during peak season when you are busy, and pay less when business slows down.
If you do have a large property and are thinking of offering accommodation, you will need access to the required bed and breakfast finance. You’ll need funds for furnishings, decorations, refurbishments and many other jobs when you get started. You will also need to pay for advertising and a website so you can attract customers. Remortgaging your property could be the best solution because it will provide low interest funds that you can pay back over the long term.
Stewart Hindley and Partners LLP is a fantastic source of advice and guidance about bed and breakfast finance and can help clients across the UK to devise a plan and find funds. We’ll work with you to identify which course of action would be most suitable for your specific situation.