If you are considering letting out your mobile home during the season this article will give you some practical advice on what you need to be aware of. The sub-letting of your caravan can be a good way for you to recoup some of the expense of owning a van, and if done properly can yield a good return.
Are there any restrictions or fees?
Firstly, check the terms and conditions of your agreement with your holiday park owner - you should have received a copy when you purchased your mobile home. Some sites do not allow the sub-letting of caravans other than to friends and family and if they do, some only allow for the bookings to be made through them.
You will also need to check if there is a restriction on the age of caravan before it can be let out to the public. Some holiday parks do not have a restriction, whilst others may stipulate that mobile homes can only be let until the caravan is a maximum of 9 years old. Obviously this can have an impact of the amount of rental income that you hope to achieve especially if the site also has a policy of allowing you keep your static home for up to 15 years. There is going to be a ‘shortfall’ of 6 years where you cannot rent out your caravan, at which point do you purchase a new mobile home and start again, or stop renting it out for the rest of the term on the agreement. This is going to depend very much on your reasons for wishing to rent out your static caravan in the first place.
If you are not allowed to sub-let your static caravan without having to go through the holiday park, or if you have decided to utilise their services, there are some cost considerations that you need to be aware of. The majority of holiday parks will charge a letting fee or commission charge or booking fee for renting out the mobile home on your behalf and this will be deducted from your rental income. These fees are often around 18% of the booking fee plus VAT and vary from park to park. Your holiday park owner will be able to confirm what they charge. At the end of every holiday the site will arrange for your mobile home to be cleaned and checked ready for the next tenant, usually by their own cleaners and this again will be charged for separately. A fee of £17.00 plus VAT is not an uncommon charge for each clean. Whilst the cleaners are in your mobile home they should also check for any damage made by the previous occupants and check the static caravan inventory. This is important as tenants will often not tell anyone about breakages and if necessary the correct person needs to be billed, or the money for any replacements taken from their initial deposit. Unfortunately accidents do happen. Some sites will insist on holiday makers bringing their own bed linen, whilst others will provide a laundry service. If your holiday park offers this service you can expect to pay around £6.00 plus VAT per bedroom in your holiday home per let.
It is wise to check with your holiday park what is included for the 18% commission fee. Is it just a booking fee, or does it include toilet paper and basic cleaning equipment, such as j-cloths, a sponge and washing up liquid for each tenant.
What about advertising?
One advantage of letting your mobile home through the holiday park is that you do not necessarily have to advertise your caravan as the site will do this for you. You could of course still choose to advertise your mobile home regardless to maximise the rental potential and many people are now choosing to set up their own simple web sites with photographs of the inside and outside of their static caravans. Other options include advertising on eBay and creating a Facebook profile page for your van perhaps with a title along the lines of ‘Mobile home holidays starting at £xxxxx for 7 nights in Dorset’ instead of a persons name. If you lock the profile, they have to request the caravan as a friend and then you can see what they are like.
When are you going to let?
Have you considered when you will let your mobile home? Will it be for the whole season, or will you save it for yourself at the beginning and end of the year? Depending on the size of your static caravan and where it is situated will determine when your caravan is going to be in peak demand. For sites that are family orientated the school holidays are more likely to be popular and sites which are less entertainment based may find that they attract business spread throughout the year.
Check with your holiday park owner when you will be informed about a booking - will they send you the details as soon as they have received the deposit? Also when will you receive the money from the letting? Do they pay it directly into your bank account once a month or is it less frequently than that?
All static caravan and mobile home holiday homes should meet the requirements of the British Holiday Home and Home Parks Association (BB&HPA) 'Code of Practice' for letting holiday homes. Your holiday park operator should provide you with a copy.
Doing it yourself
If you decide that you wish to manage the letting of your mobile home yourself you have to be aware that you would need to go to the caravan after every let, usually a Friday or Saturday, to clean and check the mobile home yourself. Is this going to be convenient, especially if you are successful in letting out the caravan, as you may need to be there every weekend for a couple of hours in between lets.
Another consideration is, who will give your tenants the keys to the static caravan and collect them at the end of the let? Whilst the fees often charged by holiday parks seem steep to begin with, once you have taken into consideration the hassle and inconvenience of traveling backwards and forwards possibly every weekend and the increasing costs of petrol and diesel and the added expense of cleaning materials, the costs do not seem quite so high.
When taking bookings for your static caravan it is advisable to taking a booking deposit and possibly a refundable breakages deposit. This will secure the booking and is a good way to ensure that the people are serious about hiring your caravan. You can also at this stage request more information about who will be staying in your mobile home, their names, address, contact telephone numbers, ages and sexes - important if you do not want same sex groups for example, stag parties renting your caravan. Do not be afraid to be selective.
Before you hand over the keys to any holiday maker always make sure that you have the full amount of rental income cleared in your bank account first. Remember that cheques bounce!
There are of course some regulations that will need to be adhered to before your mobile home can be let to paying guests and most sites will insist on seeing and possibly keeping copies of certificates before they will allow lettings to commence each year. Before the start of every season you will need to ensure that you have a ‘Landlords Gas Safety Record’ displayed in your caravan. All electrical appliances will also need to have a P.A.T (Portable Appliance Test) annually. Every three years an electrical wiring test and certificate will be required. Holiday parks that rent out static caravans on a regular basis will probably be able to arrange these for you.
There is some debate as to whether a TV licence is required. Theoretically you do not need a current TV licence registered to your static caravan ‘if the TV in your static caravan or mobile home is never in use at the same time as the TV at your main home, you don't need a separate licence’ (www.tvlicensing.co.uk) and this would apply to your tenants. But to be on the safe side and with the possibility of a fine, it is worth purchasing one.
It is also quite likely that your holiday park (and your insurance provider) will insist on a working smoke alarm, fire extinguisher, fire safety notice, gas key and safety notice and a carbon monoxide detector.
It is also essential that soft furnishings must be of a suitable standard with regards to combustibility.
Good insurance cover is a must. As you are renting out your mobile home to strangers, public liability insurance of not less than £2,000,000 may well be insisted on by your holiday park owners. It is worth remembering that unfortunately accidents will happen and not everyone will treat your mobile home in the way that you would necessarily like. You cannot over insure your static caravan.
You will also need to decide whether or not you are happy for smoking to be allowed inside the static caravan and also for dogs to stay. If you decide against one or both of these, a sign on the inside of the main door will hopefully re-iterate the point.
If you decide to let your caravan you will need to inform HMRC for tax purposes regardless of whether you are working or retired as any rent will be classed as an income.
As far as they are concerned your static becomes a Furnished Holiday Let (FHL). The good news is that a surprising amount of items can be classed as expenses including -
Heating and lighting (gas and electric)
Maintenance Repairs & Renewals (changing a light bulb, new bedding, etc.)
Any interest charges / finance charges
Cleaning charges if you have a cleaner for lets
Cost of telephone calls if you reply to enquiries or ring guests
Travelling expenses, for travelling to check on caravan, etc.
The cost of the caravan itself is a tax deductible expense, but it is also your asset too and so this will need to be taken into account.
It is still possible to make a profit on the lets and it is recommended that you have a chat with an accountant (or someone suitably qualified) as they will be able to guide you through the minefield that is HMRC. You may find that your site can recommend someone locally who is experienced in this sort of letting and may well have a fixed price for carrying out tax returns on statics. If not, there are accountants who specialise in caravan lets.
Obviously you will need to provide your tenants with a reasonably well stocked static caravan and below is a list of some of the bare essentials that should be considered.
Kettle; teapot; 4 x saucepans with lids; milk pan; frying pan; colander; oven roasting dish; casserole dish; slotted spoon; masher; scissors; bread knife; bread bin; cake container; bread / cake plate; whisk; tray; small vegetable knife; potato knife; spatula; tin opener; corkscrew / bottle opener; fruit bowl; butter dish; sugar basin; milk jug; measuring jug; large fork; large glass work top protector; toast rack; mixing bowl; grater; salt & pepper pots; coping bard / bread board; cutlery including table spoons, knives and forks, dessert spoons, teaspoons & soup spoons; egg cups; dinner plates; tea plates; cups & saucers; cereal / soup bowls; mugs; wine glasses; tumblers; place mats and coasters; oven gloves; ice cube tray; toaster; microwave; TV / DVD combo; free view / free sat box; electric vacuum cleaner; fridge / freezer; 1 duvet each bed; 2 x pillows each bed; duster; refuse bin; dustpan & brush; broom; floor mop & bucket; washing up bowl; washing up liquid & multi-surface cleaner; coat hangers; clothes pegs; clothes airer; toilet brush & holder; patio furniture.
It is not recommended that you leave an iron as it has been known for tenants to unintentionally burn holes in carpets and soft furnishings.
As you can see this list is quite extensive but comprehensive and whilst you will wish to make your mobile home as warm and inviting as possible, having too much left in it can be a burden for whoever has got to check the inventory each time and the more there is in it, the more there is to get broken or go missing.
Keeping your holiday makers happy should be relatively straight forward and hopefully the weather will be kind to them. You may wish to think about putting a welcome pack / file in your mobile home explaining how the boiler and television work for example along with a copy of the holiday park rules. You could also include leaflets for local attractions, details and directions to the nearest hospital, shops and vet, what to do in an emergency and where the best pubs are for food.
Some suggest that you write the name or number of your caravan in indelible ink on the pillows and duvets, just in case they end up at a different mobile home on the holiday park - some families may hire a couple a vans at the same time.
The rental income on leasing out your mobile home can be good way to earn some extra money and the majority of holiday makers will look after your mobile home.
If you found this article useful or have any suggestions or questions, please leave a comment below.
Lifesure are specialist static home insurance providers. Call us on 01480 402460 to speak to our friendly, knowledgeable staff.