The 'why' and 'how' to run your own guest house
For many, it's a dream that gets lost in dinner party conversations. Say goodbye to your 9 to 5. Move to a picturesque part of the country. Open up a cosy country guest house. Meet the world's most interesting people while the money rolls in. That's the life, isn't it? If you want to make 'service with a smile' your career, it's time to put a plan into action.
Firstly, what is a guest house?
You've likely been on a business trip or holiday and experienced one already. According to the Tourism Grading Council of South Africa, this is accommodation provided in a house, renovated dwelling or specifically designed building. It includes the provision of breakfast and has public areas for the exclusive use of guests.
Why start your own guest house?
Guest house management is no picnic. It's a tough journey. You'll need to be truly invested to keep going in tough times. Here are some reasons worth considering.
- Be your own boss: You can take an active role in running the establishment. You'll find it very empowering to call the shots.
- Earn a second income: Is there too much month at the end of your money? Or are you saving for retirement? A guest house could be your solution.
- Let unused spaces work for you: Maybe your kids have moved out. Maybe you've sold your car or cleared out your spare room. Now you can turn those empty spaces into money-spinners.
- Improve your property value: Having a successful guest house can make your property more attractive to potential buyers.
- Get a tax deduction: Certain expenses like garden services and security are deductible from the rental income before tax is calculated.
- Use your people skills: You're the life of the party with a knack for getting along with different personalities. Here's a career that will benefit from what you do best.
- Join a growing trend: According to PwC, the growth in travel and tourism is expected to boost growth in the accommodation industry during the next five years.
How to set up your guest house
Okay, you're sold and ready to get started. Here are some helpful steps to follow:
1. You can choose to buy an existing guest house or renovate your current property. Think carefully about your chosen location. Are there events all year round and attractions to keep a regular flow of guests? Is there enough parking for your guests?
2. Be sure to check the rezoning permissions to ensure your guest house will be legal.
3. Figure out if there's a need. You may face stiff competition from other establishments in the area.
4. You'll need to register with the Companies and Intellectual Property Commission (CIPC) and as a taxpayer for corporate income tax purposes.
5. Do a course in guest house management. It will help you learn how to control your finances, entertain guests and keep your accommodation spotless.
6. Pick your target audience and customise your guest house experience. Tourists, business travellers and honeymooners all have different needs.
7. Do an audit of your property. Whether you're renovating or buying an existing guest house, you'll want it to match your expectations. You may need to buy kitchen equipment, new bedding or add amenities like a pool.
8. Get a reliable contractor to fix faults, repairs and make changes to your property.
9. Hire your helpers. This is fine if there are already personnel available. However, you may want to bring in a team of housekeepers, gardeners and kitchen staff you trust.
10. Take out a business insurance that covers your employees and property.
11. Put some thought behind your marketing strategy. You should create a website, get active on social media and register with review websites like Hellopeter. It's also worth investing in flyers and placing adverts in newspapers and magazines.
12. Don't forget to spy on your competition. It's important to see what kind of experience they're offering on their website - and at what price.
Buying a guest house can be intimidating. Thankfully with Seeff, you have an agent who has your back. With our experience and know-how, we'll help you make the right decision - both as a business and as a property investment. View our property listings and contact our Upington team today.