More and more people are opting to take their holidays in the UK rather than travelling abroad, causing an increase in demand for bed and breakfast properties that provide private rooms and on-site meals.
Selling this kind of home can be more difficult than finding a buyer for a typical house or flat, but it can be done quickly. Read on to discover more.
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What type of property qualifies as a bed and breakfast (b&b) in the UK?
A bed and breakfast (B&B) is a small, freehold or leasehold house where the owner lives and also operates as a business.
The property has one or more bedrooms that are rented out to guests, usually tourists or business travellers, for some time usually no more than a few days, usually just a weekend.
These properties are similar to guest houses, but bed and breakfast owners typically include a morning meal in the price of the accommodation.
This breakfast typically consists of cereal, fried food, juices, coffee and tea. Most bed and breakfast properties are also smaller than hotels.
Bed and breakfast properties are especially popular in the UK because of their affordability compared to name-brand hotels. Also, some bed and breakfast guest bedrooms may not have private bathrooms, only a single shared bathroom.
Questions people may have when selling your bed and breakfast
When someone is interested in purchasing your bed and breakfast property, they’ll likely have a lengthy list of queries about it during the sale process.
Having answers to these questions ready beforehand can help to make the sale go more smoothly; if it takes too long to answer them, the buyer could become impatient and lose interest in your property.
Below are some sample questions potential buyers might have about your bed and breakfast, as well as advice on how to answer them:
- Do you get a lot of holidaymakers throughout the year? Buyers are likely interested in this question to understand how successful your bed and breakfast is annually. If you can provide data that shows your property is popular with paying guests across the year, this could potentially increase someone’s interest in making an offer to buy it.
- Is there any potential for expanding the property in the future? Some buyers may have intentions to add more rooms to your bed and breakfast to increase the number of rooms they can provide to paying guests.
- Why are you looking to sell your bed and breakfast now? You may have several reasons for selling, such as the work of running a bed and breakfast becoming too stressful, wanting to live somewhere else, or anything else.
- Does the property need any significant repair work? As mentioned, you should be honest with potential buyers about any physical problems with the bed and breakfast that require repair for it to remain habitable. Buyers will likely factor in the cost of the repair work and likely ask for a lower sale price to account for this expense.
Getting your bed and breakfast prepared for selling
First impressions are essential when trying to sell a bed and breakfast. Spruce up the outdoor space by mowing the lawn, if you have one, and fix any minor issues like:
- Broken windows,
- Missing roof tiles,
- Chipped paint
Clear out any clutter from the rooms to make them seem more spacious and valuable.
If you have the resources, consider investing in larger-scale improvements to the property that will help increase its value.
This could include a full renovation of the kitchen and bathrooms with brand-new decor, fixtures, and fittings. Buyers will be sure to respond positively to this.
Potential tax liabilities with selling a bed and breakfast
Knowing the tax implications of such a sale can help you make sure you are prepared to handle any financial responsibilities that may arise:
- Value Added Tax (VAT): This is a fee imposed by the government on services and goods. In the case of bed and breakfasts, it applies when guests pay for their stay. Speak to a tax professional about possible relief options, though this isn’t always possible.
- Income Tax: You will have to pay this tax on the money you make from guests staying at your bed and breakfast. Potential buyers will want to know the amount of tax you’ve paid each year, as this helps them decide if buying your property is a good money-making investment.
- Capital Gains Tax: This is a charge that applies when someone sells an asset. This includes houses, flats, bed and breakfasts, cars and other items. You’ll pay this tax only on any potential profits you make from the sale compared to the original price.
Deciding how to find a buyer for your bed and breakfast
Deciding the best way to find a buyer for your bed and breakfast can be a challenge:
- Selling a bed and breakfast on your own can be a stressful experience. You must create a listing that includes pictures of the interior and exterior, advertise the listing online and in local media, arrange viewings for potential buyers, and handle offers until contracts are exchanged.
- Using an estate agent to sell your bed and breakfast can reduce your stress and workload, but you must pay a commission fee that will be taken out of the sale proceeds. This fee is usually a percentage of the final sale price.
- Auctions are also a great option for selling a bed and breakfast, as the auctioneer will prepare and advertise the listing and host the auction.
- Quick Buying Company For owners of niche properties, such as bed and breakfasts, it can be harder to find a buyer. However, quick home-buying companies are popular because they can make speedy and competitive offers to buy almost any property, regardless of its age, condition, shape, size or type.
Contact Property Saviour
Property Saviour makes fast and fair offers to purchase all types of freehold and leasehold properties in London and across the UK.
Our wide range of acquisitions include bed and breakfasts, vandalised houses, flats with cladding, Mundic homes, septic tank-equipped houses, solar panel-equipped homes, flats with noisy neighbours, homes close to unsightly mobile phone masts, plots of land, lock-up garages, and more.
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