Best way to buy a second homeThe best way to buy a second home.
If you are buying in the UK, however, the 3% stamping fee will apply to vacation rentals if you own another home. However, there are stringent requirements that you must fulfil to have a home considered a vacation by the HMRC, and if you do not, you must be taxed as if your home were a regular rental, regardless of what you use it for, Mr Wright says.
One of them is Vanessa Warwick, a Guildford-based lessor and creator of the PropertyTribes real estate group. Eight years ago she purchased her first vacation home in Camber Sands in East Sussex and also owned another on the Isle of Portland in Dorset. "The decision to enter the vacation rental business was made because we had already built up a fairly large individual rental book and we thought it was a good moment to move away from that and minimize the risks.
"A lot of our default buy to lets are empty, but with the vacation you can buy everything down to the last tea spoon. Before he retired, Brian Sceats, who worked in finance service recruiting, purchased his first vacation in Marbella, in the south of Spain, before buying real estate in Antigua and Yorkshire. "At first we purchased them as our vacation destinations, but because we didn't have the amount of free space to use them as often as we wanted, we chose to use them and rent them out," he says.
Could you convert your purchase into a vacation rental? As soon as you have found a real estate, you have to make up your mind how you want to let it.