Amanda Lamb gives us her advice on investing in a property abroad...
Buying properties abroad is getting more and more popular and maybe you're thinking you'll add on a couple of days and have a look at some properties with the idea of buying a little bolt-hole. Now, unless you're incredibly rich - and if you are, how do you fancy a wife/adopted daughter/new best friend? - one of the best ways to afford a place in the sun is to rent it out for part of the year.
One of the biggest mistakes people make is thinking that renting a property will be easy. The first rule I beg you to follow is: don't buy somewhere unless you can afford any repayments you have on it without relying on rental income. There was an area in France that used to attract Brits in their thousands until a certain low-cost airline decided not to fly there any more. People who had second homes there and rented them out were scuppered. Rental markets can be very fragile.
There are some parts of the world where renting out a property is almost a given. One such place is Orlando in Florida. It's perfect for a two-week break: Mum and Dad get a well-deserved break, the kids have a ball with all the theme parks and attractions in the area and the property owner gets a handy income. Everyone's a winner.
There are lots of gated communities that have rental offices on site and which can guarantee you a good 20 weeks rental income a year. That takes the hassle out of renting. You need to work out what market you're aiming at. Most people who go on holiday want a hassle-free time - and that includes getting there. It's no good buying a place three hours' drive up a mountain and expecting a family of four to happily make that trek. Also, think about where the nearest facilities are. How far is it from the airport? Where's the nearest shop/restaurant/hospital? The more facilities on your doorstep, the better your chance of renting it out.
Next, you need to think about who's going to look after it for you when you're not there. Who will handle the hand-over days, when the sheets need to be changed? You need to make sure your old guests leave on time and the new ones arrive to find everything spick and span. You can go down several routes. The cheapest is to find a neighbour or friend that is prepared to do that for a fee. This is all well and good, but what's your Plan B? If you fall out with them, or they're ill, then what happens?
The safest option is to go through a reputable letting agent. This can be pricey - they usually take 10 to 20 per cent of your rental income in exchange for their services - but it is the option I'd recommend, purely in terms of your peace of mind. Ask around and find a letting agent you can trust - then all you have to do is wait for the money to start rolling in.
Renting out your property when you're not using it can be a great idea, as long as you follow the basic guidelines. Make sure it's not too amazing, though - otherwise you'll have trouble getting your customers out and taking advantage of it yourself!
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