We rarely inherit a property in happy times so, when things are tough, how do you make a clear, considered decision about what to do with your inheritance and maybe turn it into ‘the greatest thing’…

Making property inheritance work for you

One of our clients approached me for advice on a property she had inherited in Cornwall. In this instance, the property required some updating and remedial works and when we first spoke, she was clear that she would carry out repairs and then look to sell the property following completion of the probate process. 

She explained that she just wanted some clarity around whether to carry out minimal work and sell at a lower value or to undertake a complete refurbishment in order to maximise the sale. 

However, she also recognised that the emotion of the situation meant her judgement was potentially clouded and she was struggling to come to a conclusion. Her question to me was ‘what would you do?’

Understanding your options

I spent time looking at the details of the property and gathering a full understanding of the project she was proposing to undertake. We then sat down together and talked through the pros and cons of both projects, including the sale process and balance of risk versus reward of the two options. But what was more important for me to understand was how she was feeling about it all, as you cannot underestimate the personal impact of a project like this.

With that in mind, I encouraged her to think about the property’s location, in another part of the country. Was she prepared to take on the stress and hard work of a development project which was going to be based hundreds of miles away? Then there’s the ‘how would you feel’ factor, did the thought of the project fill her with dread, and what about the thought of giving away the potential profit? 

However, when we came back to the ‘what would you do’ question, I explained that maybe there was another option she hadn’t considered. Why not refurbish the property into a holiday let, enjoy it as a personal holiday home and then reconsider the situation in five years’ time. At that point, not only will the value of the refurbishment have been recouped (and then some!), the house value will have increased and, perhaps most importantly, emotionally she will be in a better place to decide on the long-term future of the property. 

Step by step

Although the client was keen to explore this option further, it’s fair to say this wasn’t her preferred choice, not just because there was so much to consider in terms of the practicalities of operating a holiday home so far away, including:

  • due diligence 
  • refurbishment costs 
  • holiday home set up costs
  • market research (likely rental income, seasonality and impact on occupancy rates)
  • how to run the holiday home (housekeeping/cleaning, bed linen, potential linen hire)
  • marketing and booking systems (self-managed vs agency, costs of agency/services) 
  • self-managed (how to set up & run AirBNB, Booking.com and channel management).

But with the refurbishment underway, we began to work through the next steps together, from setting up AirBNB accounts to investigating housekeeping and linen companies in the area and as the refurbishment neared completion (and the property was looking fabulous!) the client was keen to go ahead with my holiday let plan.

Working together

I’m pleased to say this was three years ago and the holiday home is a huge success, making great profits and providing a beautiful second home for the client.

Recently, she told me, “Keeping the Cornwall house is one of the best things I have ever done, I wouldn’t have even considered it without you. In fact, when you first suggested it, I just thought no way. I didn’t think I could do it. I had no idea where to start and although I said I’d like to know more my intention was always still to sell. But once you were on board supporting me, you made me realise what we could do, and did do together. It’s just been the greatest thing. I have my family home and my link to Cornwall whenever I want and the bonus is a fully booked and hugely profitable holiday let that even gained Super Host with air BnB and 9.7 out of 10 with Booking.com within the first year. This is easy to achieve if you know how, and Colette seriously knows how. I can’t thank you enough. Here is the house she worked her magic on: https://www.airbnb.co.uk/rooms/25043571.”

Working out what the future holds for a property you have inherited is never straightforward, but it’s vital that you understand all the options available to you, to enable you to make the right decision at the right time, for you.

If you would like to discuss a project or are looking for guidance and advice about property investment or development then we would love to hear from you hello@cotswoldpropertypartners.co.uk or 07736 847960.

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