The average price of a holiday lodge in the UK is around £150,000. But how much do holiday lodges depreciate and is it worth buying one as an investment?
It’s no secret that all properties lose value over time. Whether it’s a house, a car or even a piece of art, everything you buy will be worth less in the future than it is today. The rate at which any given asset loses value is known as depreciation.
So, how much do holiday lodges depreciate? Unfortunately, there’s no easy answer as there are a number of factors that can affect depreciation rates. These include things like the age and condition of the property, as well as location and market conditions.
That said, we’ve done some research and found that the average holiday lodge will lose around 15% of its value in the first year after purchase. This means that if you buy a lodge for £150,000, it will be worth around £127,500 after 12 months.
Of course, this is just an average and some lodges will hold their value better than others. For example, newer lodges or those located in desirable areas are likely to depreciate at a slower rate than older properties or those in less popular locations.
So, if you’re thinking about buying a holiday lodge either for personal use or as a buy-to-let investment, it’s important to do your research to find out how much similar properties have sold for in the past. This will give you an idea of how much the property is likely to be worth in the future and help you make an informed decision about whether or not to buy.
The Truth About Holiday Lodge Depreciation
If you’re thinking of buying a holiday lodge, it’s important to be aware of the potential for depreciation. Here, we take a look at what depreciation is, how it can affect your holiday lodge and what you can do to minimise its impact.
What is depreciation?
In simple terms, depreciation is the reduction in value of an asset over time. When it comes to property, this can be caused by a number of factors including wear and tear, changes in market conditions or changes in legislation.
How does depreciation affect my holiday lodge investment?
The value of your holiday lodge will depreciate over time. This means that if you sell up, you are likely to get less back than you paid for it. The rate at which your lodge will depreciate will depend on a number of factors including its age, condition and location. However, as a general rule of thumb, you can expect the value of your lodge to reduce by 15% within the first year.
What can I do to minimise the impact of depreciation?
There are a number of things you can do to minimise the impact of depreciation on your holiday lodge investment:
- Choose wisely: When selecting your holiday lodge, be sure to choose one that is located in a desirable area and is in good condition. This will help to ensure that it retains its value for longer.
- Keep it well maintained: Regular maintenance and upkeep will also help to keep your lodge looking its best and limit the amount it depreciates over time.
- Use it often: Making use of your holiday lodge on a regular basis will also help to keep its value up as lodges that are left unused for long periods of time tend to depreciate more quickly.
The Best Time to Sell Your Holiday Lodge
This is a question that many lodge owners ask themselves at some point. There are a few things to consider when making the decision to sell. The most important factor is usually the market conditions. Other factors include your personal circumstances and how much you need or want to get for your lodge.
The current state of the economy and housing market will have an impact on how much your lodge is worth and how easy it will be to find a buyer. If you need to sell quickly, you may have to accept a lower offer than you would during more stable economic times.
The time of year can also affect how quickly you can sell your lodge and for how much. In general, spring and summer are the best times to sell as there are more buyers looking during these months. Families with children are often looking for a summer home during this time so they can take advantage of school holidays. However, if you’re not in a hurry to sell, waiting until after the summer season may mean getting a higher price as buyers who missed out on their first choice will be willing to pay more for their second choice.
Your personal circumstances will also play a role in when you decide to sell your lodge. If you need the money from the sale for another purpose, such as buying a new home or paying off debts, then you’ll need to sell as soon as possible. However, if you’re simply wanting to upgrade to a newer model or different location, then you may be able to wait until it’s more convenient for you.
When selling your holiday lodge, it’s important to work with an experienced real estate agent who knows the local market well. They’ll be able to give you advice on when is the best time to sell based on current conditions and help you get the best price possible for your property.
Find out Why holiday lets don’t always make profitable property investments
When Is the Worst Time to Sell Your Holiday Lodge?
If the market is struggling, then it might not be the best time to sell your lodge. However, if the market is doing well then it could be a good time to sell. It is always worth keeping an eye on the market and speaking to a few different estate agents to get their opinion on whether now would be a good time to sell or not.
Another thing to consider is your personal circumstances. If you need to sell your lodge for financial reasons, then you may not have much choice in when you sell it. However, if you are selling because you want to upgrade or downsize, then you might have more flexibility. It is worth considering what your plans are for the future and whether selling now would fit in with those plans.
If you are thinking about selling your holiday lodge, then it is worth taking some time to think about when would be the best time for you personally. Consider your circumstances and the current market conditions before making a decision.
Buying a Holiday Let Investment vs Short Term Investment
If you are looking to invest in a buy-to-let holiday lodge, but don’t want the burden of a depreciating asset, then a short term investment could be a better option for you.
A particular style of holiday lodge investment that reaps all the rewards through a more hands-off approach, and one that is becoming increasingly popular, are lodges in parks such as Landal Belvedere and Landal Barnsoul.
Finding an investment with a reputable management company is important when looking for a well-managed, hands-off investment. At GladePark Investments, we work closely with our management company Landal GreenParks to ensure your lodge plot investment is well maintained and all customer-facing admin is taken care of, so you can oversee your investment without sacrificing time and resource into maintenance and management of the property.
Our holiday resorts offer hassle-free investment opportunities from the plot of land, right through to the finished product, producing a reliable income without the need for consistent customer admin and property maintenance.
Our buy-to-let holiday lodge investments offer:
✔️ 5 year fixed income guarantee, which doesn’t rely on a fluctuating holiday market
✔️ Avoid the depreciating value of a holiday lodge with our compulsory buy back scheme after 5 years
✔️ Pay no capital gains tax, stamp duty or council tax
✔️ Choose a hands off investment with no maintenance fees. Our lodges are fully managed by award wining management company, Landal GreenParks
Get in touch today to find out how you can start your investment property journey.