FAQ

Hotel Room Ownership – Buy A Room From £22,000.

Fullshare NOT Timeshare.

Frequently Asked Question Section (FAQS)

 

Q1: If I buy a hotel room, can I sell it?

A1: Yes you can sell your room. It is yours. You will own it. You are entitled to sell it. 

Q2: If I need to sell my hotel room, is there a market and how much will it be worth?

A2: We cannot guarantee this. But unlike the challenging timeshare resale market where people try to sell the “week” they own, this is a much more solid asset. You own your hotel room outright. Therefore it is likely there will be a demand to buy. Especially given the very hard negotiations made to buy the whole hotel at the outset, and this being reflected in the low price the first sales of rooms are being guided at.

Historically and factually, none of our current and previous hotel-room-ownership members have lost money. Three of our hotels achieved between 50% and 160% MORE than was paid to buy. Only one had what might be termed a dull outcome. Even that managed to break even. None lost money. However, it is up to individual hotel-room-ownership buyers to study this entire website, ask as many questions as you need, and also take as much independent advice as you require in order to make a fully informed decision. The current project we have listed on the Candidate Hotels webpage has the arithmetic working out at a starting price of £22,000 and going up to about £33,000 for each hotel room – depending on size, outlook/aspect etc.

Q3: If I want my hotel room rented out in my absence, who does this, and how much income can I expect?

A3: Each hotel we buy will have a traditional, but separately owned restaurant and bar/coffee shop/internet cafe areas. They can, where hotel-room-owners desire, be contracted to provide full housekeeping, maintenance, hotel reception, concierge and account keeping for those hotel-room-owners that wish to avail themselves of this service. A fee will be negotiated which for ballpark purpose leaves around 60% to 65% of the nightly room rental rate due to the room owner. For guidance the room rate income component will be about £30 to £35 per night. We are unable to guarantee how many nights a year your room will be rented out. For fairness, room rental will be on rotation. Any given customer coming into the hotel will be offered bedroom 1; the next customer bedroom 2, the next customer bedroom 3 and so on. This ensures everyone who wants to rent their room out when they are not in residence themselves will have a reasonable number of nights rented.

Q4: If one of the privately owned communal parts of the hotel (e.g. restaurant) is under performing and affecting occupancy, is there anything that can be done by the other hotel-room-owners?

This is an excellent question from a site visitor. An issue that has been perplexing us. It is important to foresee and address any potential snags on this project before they happen. As a direct result of this question, we have taken the appropriate advice (longer answer about plc share issues and FSA regulations can be emailed to anyone wishing the fine print). We had intended to sell the Hotel part of the building and the Bar part to suitably qualified individuals. However this vital aspect of the project has now been revised. Our sister holding company will buy both the remaining Hotel (not the bedrooms) and Bar parts of the building. A PRIVATE company share entitlement will then be available for any hotel-room-owner to take up in direct proportion to the number of hotel bedrooms they own. The Hotel and Bar elements will be owned by hotel-room-owners via a dedicated limited company created for that purpose. The Hotel and Bar will then be leased out. This way if either Hotel or Bar under perform, or fall down on materially important aspects, then the hotel-room-owners have a direct control over what guidance; fiscal penalties or sanctions are needed. Hopefully this answers the question. Anyone needing further clarification, please email.

Q5: If I buy a hotel room, how is this transacted? I am concerned about my money and who I entrust it to?

A5: Very good and an important question. We have always made it a rule, and it continues to be at the heart of these projects that we do NOT handle any money. If you visit the hotel to inspect it, examine the survey, read this website thoroughly, plus ask the questions you need to ask, then decide to buy a hotel room/rooms of your choice, you will be put in touch with the project solicitors. They are proper solicitors and hold the appropriate law society membership and indemnity insurance. The solicitor will place any funds you send into their legally protected client account. That money shall, indeed can only be used for the purchase of the hotel room of your choice (or returned to you in the event the whole hotel building purchase does not go ahead). If all goes to plan and the hotel is bought, you will receive the appropriate HM Land Registry documentation proving, and underwriting your ownership by HM Government of the room asset bought, along with your room keys and front door keys. Next step, you come for a holiday! 

Q6: Who owns the communal parts? Are there any obstructions to my getting to my room whenever I want?

A6: The communal parts are shaded blue in the plan drawings shown on the Candidate Hotels webpage. There will be a right of access across these in perpetuity by all hotel room owners, their family, visitors and guests.

Q7: Can I rent the room out myself, or let my friends and family use it?

A7: Yes. We positively encourage this. The more people that can be brought to the formerly closed hotel and with that, the local community area, facilities, such as golf, hillwalking, watersports, the better for all concerned. Any people you rent your room to yourself (and providing you take care of all the linen, room cleaning etc), then you retain 100% of the proceeds from that.

Q8: What hidden costs are there?

A8: We hope there are no “hidden” costs. We will endeavour to be upfront and clear about any costs that may fall due in the normal course of owning a building (or a part of a building).

For example, there will be a share of the hotel building rates due to the local council. This will be equitably distributed between the respective hotel part owners. For example 20% paid by the Bar Owner; 20% paid by the Restaurant and Internet Cafe / Coffee Shop Owner with the remaining 60% divided by the 14 Hotel Bedrooms. Arithmetically this means each hotel bedroom owner would be due approximately 4.28% of any communal hotel bill. For our example the annual hotel rates are 12,250 x 42.6p payable for the year 2011/2012. The total rates payable for the hotel are £5,218. Multiply this per bedroom at 4.28% and each hotel room owner would be liable for an annual rates bill for their room of £223.33. This works out at just over 60p per day, and is an eligible deduction from whatever rental income is received if and when you rent your room out. There are other costs such as buildings insurance, water rates, electricity (which can be metered per room if desired). Also, whilst the buildings are handed over in good and serviceable condition, it is a reasonable idea to put some funds aside from income to cover future general maintenance. Each hotel room owner contributing 4.28% to these.

Q9: I spoke to my accountant and he mentioned that there may be a tax efficient way for me to own a hotel room. Please can you enlighten me?

A9: We are aware of tax efficient Self Invested Personal Pensions (SIPPs). These have been used in similar projects successfully, and as far as we know can be utilised with our proposed hotel room ownership if you elect to do so with HMRC …

http://www.sippinvestmentplatform.co.uk/information-about-investments/investment-structures/

However, we are not authorised to advise on FSA regulated issues. Indeed we would recommend all prospective hotel room buyers at least have a chat with their own accountant, lawyer or independent financial advisor.

There is plenty of information on tax efficient SIPPs and other ways to maximise your benefit from buying a hotel room. For example, SIPPs are covered on the Martin Lewis website ..

http://www.moneysavingexpert.com/savings/cheap-sipps

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