Buying property with annexe - can we Airbnb the annexe ?

[EezyOozy]

Hi all,

We are very interested in a property - its fairly rural and perfect for our family and it has a 2 bed annexe. The annexe is adjoined to the house and the current owner seams to use it for storage mainly (!) but it has a bathroom and 2 bedrooms. It's a detached house with no close neighbours... the annexe needs some updating and I'm looking into converting one of the rooms to a lounge/kitchen and renting it out on Airbnb. The garden and drive layout is such that is could have a separate drive and bit of garden too.

Has anyone done this ? Are there any glaring pitfalls I am missing? I'd be grateful for any pointers / things to look out for from those with experience - I've not done anything like this before!

I have two children and thought (perhaps naively) that if it's a fairly small operation I could do the change overs myself for some income .... it's a very beautiful area so eventually (obviously not in the midst of the Covid pandemic) we could have it presentable and rentable.

I'd need to look into into buildings insurance (I think there are some providers that allow for Airbnb use in an annexe) and I guess public liability / business insurance ? My husband is self employed so I'm hoping his accountant could advise up about the tax side.

To me this idea seems to make sense ... maybe there are things I've not thought of though! Thanks 😊

Also check with your mortgage provider if they are happy with your plan.

[quote hassletassle]@christmascarly good point about fire extinguishers etc. Are there special guidelines about fire safety? I'm generally pretty careful about stuff like that (we have loads smoke alarms and CO2 alarms, some extinguishers etc). Actually come to think of it I think Scotland are making hardwired/linked fire alarms obligatory soon ...[/quote]
You will need fire alarms and extinguisher, and probably a proper fire door between the properties. If there are beds upstairs you will need a fire safety check and certificate. In Scotland it,s a legal requirement to be a registered licensed landlord (apply through local council).

In addition, Scottish govt is introducing a new license specifically to control Air BnB (it may be restricted in certain areas) so check first to find out what the limits are.

We used to do B and B. I recommend that you think very carefully about who is your target market and equip it for them (cyclists will want secure storage; walkers need overnight drying space and a hard entrance floor for muddy boots). Then stick to it. We aimed at cyclists, walkers, golfers, couples, and did not host smokers dogs or children(various safety issues, think about garden ponds, fences, neighbouring livestock. ) Are you within easy reach (for guests) of food shopping and evening meals ?

@2bazookas and @AntiHop That's extremely helpful, thank you-lots to think about! I think the target market would be walkers and cyclists (Couples) and there are a couple of wedding venues and a large national music festival that take place close by every year as well X

@hassletassle Also check with your mortgage provider if they are happy with your plan.

You do need to do this.

@hassletassle if the annexe is a separate dwelling or in the process of being converted into a separate dwelling it may qualify for multiple dwellings relief on your SDLT. Worth checking as it could save you thousands and doesn't seem to be dependent on planning permissions rather what facilities the annexe has.

We let the annexe of our house with Northumbrian Cottages, it worked very well as they took the bookings/deposit etc.

Get a 'pink book' before you decide, there is a lot of legislation when you are letting. Good luck!

www.visitbritain.org/visitengland-launches-new-edition-pink-book

Thanks everyone - I'll have a proper look at the pink book later.

As others have said - make sure you can install a kitchen if you want that - friend of mine has done it - but it was not allowed - they did it anyway - they don't rent it out but like to think of it as a "Nanny Flat"

We've got a self contained basement flat as part of our house. Before Covid we rented it on air BnB. It was quite successful, but we did have one or two issues from guests. We made about £500 a month. I managed it myself and cleaned between guests. It was a chore and difficult sometimes (I do work full time in quite a full on job), but worth it for the money.
One thing you should definitely look into is stamp duty. Annex can be classed as a separate dwelling and there are stamp duty rules that may be beneficial to you.