The property’s location, its look and feel, and its condition will all have a huge impact on the size of your investment, the amount of work you’re committing to before you turn a profit, and the amount you can expect to receive from guests wishing to stay with you.
And that’s not even considering the fact that you’re likely choosing your family’s new home at the same time.
To make sure this decision is not taken too lightly, we’ve provided these five fundamental points to take into consideration before signing on the dotted line:
1. Your Personal and Business Requirements
As the person who will be living in and running this inn, it’s vital that every one of your wants and needs are established and understood before even looking for a property. And that includes your personal preferences too, not just important items like your budget and business plan.
For example, if you can’t imagine living anywhere other than the city, you shouldn’t consider buying a B&B property deep in the rolling hills just because it’s less expensive than an urban alternative. Likewise, if you can’t stand the smell of the ocean, a beachfront property doesn’t make sense for you, no matter how potentially lucrative it could be.
2. General Location
For your Bed and Breakfast to be successful, it’s going to have to be in an area where visitors routinely travel, and within a reasonable walking or driving distance of at least one tourist attraction – whether that be manmade or natural.
Claim up to $26,000 per W2 Employee
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- This is not a loan. These tax credits do not need to be repaid
While there are interesting and fun things to do all across the United States, this is a huge country. There are most definitely places where a B&B will simply never work.
3. Specific Location
The property itself will dictate the need for a number of other upcoming decisions, such as: decorating, remodeling, landscaping, signage, etc. If you’re not in a position financially to both purchase and extensively remodel a property, you’ll want to limit your selections to homes that are essentially move-in ready.
Another factor to consider also is zoning and how it will affect your ability to run a B&B in that location. Many times, zoning by-laws can be amended, but it’s often a costly and slow process that may not fit well into your business plan.
4. Separating Work and Life
In most B&B locations, the proprietor’s family live on the premises. While this can be a convenience in many respects, it also lends itself to uncomfortable crossing of lines, such as when a guest wanders in and does a load of laundry in your personal laundry room, or knocks on your bedroom door at 11:00 pm searching for a clean towel.
One way to help keep these difficulties to a minimum is to choose a property that allows for a clear separation of guest rooms and common areas from the portion of the house where you and your family will live. In some cases, this will already be part of the home’s design, but in other cases you’ll be looking for potential for an effective remodel that will accomplish this purpose.
5. Achieving Business Goals
Finally, finding the perfect property to meet all of the above requirements would really be a waste of time if it was incapable of supporting your business goals over the long haul.
For example, if you were to find an absolutely perfect property that has three guest rooms, but your business plan and financial requirements demand a minimum of six rooms at 80% occupancy throughout the busy season, that perfect property simply isn’t going to work.
On the other hand, if you can locate a property that meets all of the above requirements AND has the potential to meet your business goals as well, you may have just found your dream B&B!
As a side note, one of the best ways to cover all these fundamentals and more is to purchase a property that has already been used as a B&B for some time. Speak to the owners, get the details that will help you answer the above questions, and you’ll be well on your way to a profitable decision.