Holiday lets: are you tuned up for the 2014 season?
But beware: there could be paperwork to sort out. Rules governing holiday lets are now controlled by regional governments in mainland Spain, meaning owners who do not prepare in advance may not have their property ready in time for high season.
Why? It is highly likely you will need a licence or approval of sorts from the local town hall to let your property legally.
There are also strict rules governing holiday lets in the Canaries. Typically, homes in residential areas which are not part of a tourist complex cannot be let without a licence – and obtaining one is not easy.
Meanwhile, properties which form part of a tourist complex are usually obliged to use a certain letting agent, registered as a sole agent for that complex.
Advice should be taken from an experienced letting agent to ensure you stay within the rules and don’t leave yourself exposed to large fines, either in the Canaries or in the Costas.
However, once the paperwork is sorted, it’s time to prepare your property. And to enable things to run smoothly, here are 10 tips to help you get started.
1. Get to grips with the local rules for receiving paying guests. Depending on the location, you may be required to give their passport details to the local police station, just as hotels must record these details. You may also need to collect a tourist tax from your guests, which you pass on to the local government.
2. Declare your rental income. Remember, the authorities are looking at international rental websites to track down tax-dodgers. The UK has double-tax treaties with most European countries, including Spain, so you won’t pay the same tax twice.
3. Choose your letting agent carefully, if you are allowed to do so. This is especially relevant if you live in the UK and cannot respond to problems immediately. An agent can take away much of the hassle of rentals, so look for one who has a good reputation locally. Normally they will charge 15-20% of the rent received and, although this can seem a lot of money, they will ensure your property is well-maintained, supply cleaners, meet and greet visitors and be on call if there are problems.
4. If you manage your property, be prepared to work hard. You will need to answer all enquiries from prospective renters, keep a calendar of arrivals and departures, maintain the premises to a high standard, welcome your guests and check everything when they depart – and be on 24-hour call for emergencies.
5. Present your property well. Take really good photos for your advertisement, not only of the interior but also of the surroundings. Cleanliness is paramount, and tourists from all over the world expect high standards.
Think of small things you would like to find if you were staying in your home – little extras count for a lot and earn good reviews. Don’t forget, TV, Satellite, Wi-Fi and DVDs are often expected these days!
6. Offer a welcome pack. Sometimes visitors arrive late, the shops are closed and they don’t want to go to out to eat. A basket of essentials is always welcome – eggs, butter, bread, tomatoes, salad, water, beer and/or wine.
7. Information about what is happening in your area is gratefully accepted. Leave the district’s calendar of events, leaflets about local attractions, music festivals, sports and pretty beaches. Mention all these in your advert. Direct guests to local tourist offices for more options. Don’t forget to mention local markets of all descriptions. Holidaymakers love markets!
8. Get suitable insurance. Your household and contents insurance policy should be provide adequate cover for holiday rentals, including the necessary third party liability and cover for vacant periods. There are UK insurers that specialise in these types of policy, or look locally.
9. When you need to send money to your euro bank account in the Canaries or mainlandSpain, for example, to cover any running costs or mortgage payments, use a currency exchange specialist, such as Smart Currency Exchange, rather than just asking your UK bank to make the transfer.
Why? A currency specialist will give you far better exchange rates than your bank and offer a faster, more personal service.
The same applies for when you need to repatriate money from your Spanish euro account to your UK bank. If you’re yet to buy your Spanish property, you could save thousands by using a currency specialist to pay for your new home.
10. Price your property realistically. Find similar rental properties to yours on the internet to get an idea of rental rates, and what is included in those rates.
If you offer more, you can charge more: bed linen and towels provided (difficult to transport for guests travelling from abroad), satellite TV, internet connection, children and pets allowed, travel cot provided, useful items provided (tea, coffee, salt, sugar, olive oil, vinegar, washing-up liquid, kitchen roll, toilet roll, soap, shower gel, washing powder all – inconvenient for guests to have to buy for a week’s holiday).
And a professional cleaning service saves time for departing guests and gives you reassurance that your next guests will find an impeccable holiday home.
With rental experience and positive reviews on your property, you will be able to charge more. Therefore, it is worth pricing the rental slightly lower for the first season in order to gain ground in both of those things.
Consider changing your rates according to the popularity of the season. Check your local events calendar for important dates, which may enable you to charge a premium to tourists booking for a particular event (motor racing, a fashion show or a carnival, for example).
Also, decide how you want payment of deposit, damage deposit and balance. An example could be: 30% deposit to be paid upon booking by cheque, transfer or PayPal. Balance to be paid six weeks before arrival, via the same method. Damage deposit to be sent by cheque with the balance (or handed in on arrival in return for an up-to-date inventory) and returned or destroyed once the apartment has been checked after the holiday.
To round off, make sure you book weeks for yourself at the start of each year! You want to get enjoyment from owning a holiday home in Spain, so plan ahead.