FORUM: Beware of scammers!

Here is a letter from one of our owners in New-york (New York Apartment Magnolia) warning us against scammers - please read it:

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Please beware that your sites are being targeted by people who are successfully convincing owners to participate in a payment for services plan which involves guests who send checks which are in excess of the amounts of the actual rental fees. They ask owners to send the balance back to a "travel agent" for the guest travel arrangements.

I have been a victim of this scam and have lost $3,300 plus the scam artists booking/reservation fee. The check turns out to be counterfeit etc.. The bank shuts down your accounts for 48 hours and it is a nightmare. They ask you to send this overpayment via western union which makes it an anonymous transaction, so they can't be caught.

I hope that you can post this as a warning to your owners in your network.
AT least we can be alert and on guard for this stuff.
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FORUM: 7 Pitfalls

The Pitfalls of Short term letting your holiday home -

If you are lucky enough to own a farmhouse in Tuscany, a villa in Florida or an apartment in Paris, then you might be thinking about turning this property extra income earner by renting it out to holiday makers. There is many sites including Holiday Velvet that enable you to advertise your property in a cost effective way to a global market. As long as the price, quality and the advertising is right you could turn this initiative into a profit earning enterprise.

But how do you avoid the pitfalls of short term letting?

Always be cautious about whom you choose as a holiday maker into your home but, apart from that, here are a few basic rules to follow.

1. Always keep your book keeping in order. This is where you can ensure that your property turns itself into a profit generating business.

2. Make sure that you have a contract with attached terms and conditions related to short-term or long-term leasing. It’s possible to get contracts fairly cheaply and make sure that it gets approved by a lawyer. This protects your rights as well as the tenants.

3. Always provide a welcome pack including easy to read instructions on how to manage your home. This should include details of where the fuse box is, how to manage the hot water boiler, satellite TV instructions (if you have it) and whatever else you think would be helpful to make your guest feel at home.

4. Make an inventory of everything in the property. When you let your holiday home, you will go through this with the new tenant and ensure they sign the contract. This way, there will be no dispute as to what should be in the place when they leave.

5. Always take a security deposit that is returned when the tenant leaves the property. This will be returned at the end of the stay as long as there are no debts or damage to the property.

6. Always take a fixed amount of the overall booking fee as confirmation of the reservation. An invoice should be sent before and receipt after the payment has been made to your potential guest. Make sure you always attach your terms and conditions.

7. Make sure that you keep your calendar up to date. It’s easy to forget a reservation and make a double booking – remember that you are dealing with people’s holidays where some people only get one vacation a year.

Care to share your thoughts on the topic?

FORUM: 8 Golden Rules

Golden rules for vacation rental letting -

Buying a second property as a holiday home and renting it out to holiday makers is a shrewd investment for many people. There are many pitfalls that stand in your way so a decision like this should never be taken lightly. Below you’ll find 8 golden rules to turning your disposable income into a sound invest for the future.

1. Location is everything - Choosing a good location is essential but it doesn’t automatically mean looking at the most visited destination as many of the properties would tend to be overpriced and the area too competitive. Destinations like Florida and Spain have, over the years have become highly competitive with thousands of holiday villas available for rent. Look for areas close enough to major cities for those wanting long holidays or weekend breaks that also offer facilities close to the home - restaurants, bars or shops, particularly since holidaymakers will be catering for themselves. Many letting agents recommend targeting the weekend break market, as demand for this segment as been rising steadily over the past 5 years.

2. The best properties to buy are with two or three bedroom because most holiday homes are booked by small groups of young friends who share a property, or young families with children. Also avoid big properties - only 15 per cent of holiday lets require more than three bedrooms. If you decide to target couples, make sure that it’s in a prime location as size won’t be as important to this customer segment.

3. Fund your purchase through an interest-only mortgage because the interest payments can be 100 per cent offset against tax. If you have a lump sum following the sale of your buy-to-let, pay off a chunk of your main home loan and rely on the largest possible interest-only mortgage for the holiday property.

4. No company can guarantee you 100% occupency for your holiday home. You can make a good start to your research by checking out the competition on www.holiday-velvet.com and see what other similar properties are retailing at. Then look at exactly how how many bookings you need a year to break even which is crucial if you plan on making a profit on your investment. You’ll have costs such as management fees (15 to 30 per cent of the rental income), insurance, repairs and upkeep. Some of these costs can be set against tax and offset against non-property tax bills.

5. Hire the right letting agent to advertise your property, find tenants, manage turnovers and arrange maintenance. These can be costly or if you choose to do this by yourself, choose the best rental company for your area and property. You could do no better than start at www.holiday-velvet.com

6. Maintain the property and ensure that it’s up to date with the best appliances and technology. Satellite TV, dishwashers, DVDs and CD players are no longer luxuries. Due to strict fire regulations, you will also need to put extinguishers throughout the home and ensure that there is easy exit from the property incase of an emergency.

7. Insure your property and most agents will require you to have public liability insurance.

8. If you’re not good at book keeping, learn how to do it and keep it all in order. Keep your finances in order as much of the costs may be set against your income.

Care to share your thoughts on the topic?

FORUM: Warning to Advertisers

Holiday Velvet Advertiser and owner of London Apartment Mayfair warns about what has come to be known as the "Nigerian Scam":

"A Nigerian scam (the original started in that country) is where someone is approached for a property rental, agrees to take the inquirer on and then is asked to accept a rental payment much larger than necessary. It is further requested that the overage be returned to the renter immediately. By the time the large rent check fails to clear the account on which it was written, the stupid owner has already wired the overage to the prospective tenant. I know it's beyond dumb, but there are many court cases here about this subject matter, which also works by being told you've won the lottery in some foreign country. Of course, the police never catch up with the crooks, as they are never in the same country as the scam."

We urge all Holiday Velvet Advertisers to never accept larger rental payments and not to accept deals if you have any suspicion about the inquirer.

Care to share your thoughts on the topic?