A Guide To This Style of Secondary Residence
Investing in a static caravan to be pitched within the grounds of a holiday park can be a fantastic investment as a second home.
With 365,000 static caravans in the UK, this type of accommodation is clearly a very popular way of life which is why many are used as second homes. But what are the restrictions of using a caravan as your secondary residence and how does this work?
Holiday Park Agreements
If your static caravan is pitched permanently at a holiday park, then you will have entered into a contractual agreement with the park owner. In the agreement, you’ll find a section which details exactly how long you’re allowed to reside in your caravan for. Sunrise Holiday Homes explains that there will be certain months of the year when the park is closed, therefore your caravan will be unavailable during this time. As you should only be using your static caravan as a second home, you should return to your primary residence, or venture elsewhere during the closed season.
As the closed season typically coincides with winter, some retiree expats choose to live abroad throughout autumn and winter, so as to benefit from the chance of warmer weather. They might then use their caravan when visiting family and friends back in the UK for short trips over the summer. If you plan on using your caravan for this type of long seasonal stay, you should check with the caravan park to ensure that they will allow prolonged use of the caravan.
Although stamp duty is usually applicable on second home purchases, it works slightly differently with static caravans. There is no stamp duty tax due on caravans or other similar abodes including mobile homes, lodge accommodation or park homes. As you’re only purchasing the property and not the land which it resides on, stamp duty tax doesn’t apply in the case of static caravans. This makes them a fantastic alternative to a traditional bricks and mortar style of second home.
Sorting out insurance
Even though you may be saving on stamp duty though, you shouldn’t forget about the cost of insuring your caravan. You’re not obliged to go with the cover package offered by your park owners, so it’s best to shop around to find the most appropriate and cost-effective deal for you.
Letting Out Your Property
If you’re not planning on visiting your static caravan for more than just a few weeks a year, you may wish to look into letting out your second home in order to recoup some of the costs involved. The pitch fee at some sites can be as much as £5,000 per year, so by letting out your caravan at certain points of the year, this could be a great investment opportunity for you. If you choose to purchase a caravan with a view to letting it out to paying guests, remember to check with the site owner about any restrictions they have on this. You should also be aware that this type of income will be taxable.
Buying a static caravan as a second home has so much potential both as accommodation for you and your family to enjoy, as well as an investment opportunity.