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The secrets you need to know about buying a pine lodge in the Lake District

First of all, buying a Lake District pine lodge is not like a buying a house - it is more like buying a car. This sometimes surprises people who expect to go through something like the conveyancing process used when buying a house. You can actually buy a Lake District log cabin and the associated licence pretty much on the spot if you have the cash in your hand.

Annual Running Costs

The most obvious information that you will need is a list of all the costs involved. These can vary from park to park but the list below shows the charges at Limefitt Park in Troutbeck which is probably pretty representative.

• Site Fees - for 2010/11 these are £3,987.48 p.a.
• Rates - for 2010/11 these are £473.66 p.a. (it doesn't matter how big your lodge is)
• Utilities - Budget about £250 a year in total for gas and electricity depending on how often you use the log cabin. (If you let your lodge this can be as high as £1,000)
• Insurance - You can expect to pay anything from £400 a year or more depending on lodge size and who you but it from.
• Drain down - You will need to drain down the lodge for the closed season (£90 to £180 depending on where you buy the service)
• Boiler service - will cost about £100
• Revarnishing / repairing the pine lodge - you need to factor in about £1,000 a year

This list may not be exhaustive but it will give you good idea of the sort of annual costs that you will encounter.

All in all you can expect to pay between £6,000 and £7,000 a year (in 2011) in addition to what you pay up front for your licence agreement.

Other Costs

You might think that people who have spent up to a quarter of a million pounds on a pine lodge in a place where freezing temperatures mean you can be without running water would get trace heating fitted as standard when they buy - but not necessarily so! Budget £1000 a lodge to get that done if you don't fancy New Year without being able to shower or wash up.

Exit charges

Be aware that your agreement probably states that you will have to pay the park owner commission when you come to sell. At the time of writing this is set at 7.5% + VAT (9% as of Jan 3 2011) of the selling price on the park I use. That's about £10,000 on the cheapest new pine lodge available on the park today . Yes it is a lot isn't it!

This 7.5% + VAT is not really a commission for sales activity but is more like the bid/offer spread on a pension payment. (NB the government decided that the standard 5% bid/offer spread on pension payments was piratical and so fixed the limit on stakeholder pensions at 1% - some food for thought there!). You would be best viewing the money you pay on sale as a deferred payment as part of the purchase.

So, if you don't feel comfortable with having a 6 figure asset that may be very hard to liquidate quickly without losing money then walk away now.

Capital Appreciation (or not)

Your sale / licence agreement should include a statement similar to the following as part of the signature box:

"You should understand that the purchase price of the caravan and any resale value are subject to a variety of factors and resale value may improve or reduce over time. "

People who bought lodges a while back have seen some capital appreciation, although you do need to understand that as your lease gets shorter the value of your lodge decreases. A lodge with 40 or 45 years may be worth about the same, but a lodge with 10 years left will probably be seen to be worth considerably less than one with 15.

Logic says that lodge prices must be related to house prices generally and to local property prices specifically. If you buy at the top of the cycle your opportunity for short term capital growth will be limited and you may probably expect the value to reduce.

Remember that a large percentage of any growth will go back to the park owner in sales commission anyway.

At the time of writing, any gains will be subject to Capital Gains Tax in the normal way. Consult an accountant for more details.

Rental Income

Many people I have spoken to tell me that they are told that the sales people tell them how easy it is to sublet a lodge to cover the site fees. Whilst on the one hand this is a great advantage to buying on a site that allows sub-letting, you do need to do some homework here. Before you accept this at face value ask them to put you in contact with an owner who has successfully sublet via their scheme, and do a bit of research yourselves. You can sublet succesfully but you may be in competition with the park owners, and it is not as easy as may be made out!

Contracts

Make sure that all documents referred to in the contract - Park Rules, Site Charges etc are provided to you before signature. Now READ ALL OF THEM. Now read them again! Don't sign until you have done so.

• If you don't understand or like anything you read, then ask questions now.
• If anything worries going forward get it confirmed in writing now.
• If there is anything you don't like either get a side letter exempting you or amending the condition.
• I cannot stress enough the importance of getting these all of these issues clarified before signature.
• Did I mention that you should read all the paperwork before you sign?

Title

Curiously many of lodge owners I know did not get given any documents that prove that they actually own the pine lodge itself. It may be implicit in the licence agreements, but it would still make sense to insist on a document stating that title of the log cabin is vested in you as soon as your money is paid. If not, and the park owner or the pine lodge supplier went bust, you could find yourself in an awkward position.

Warranty

Ensure that you are aware of the warranties provided on the cabin, its fabric and its fixtures and who will be providing remedy in the event of failure. We were not given any written warranty or guarantee when we bought our Lake District pine lodge and had to chase up the park owner and the manufacturer to get written details when we hit problems. This was not a comfortable situation to be in.

So would I recommend that you buy a Lake District pine lodge?

As it says on www.justlodges.com "Most park owners will tell you that their existing lodge owners are their best selling force, so take advantage of using them!". I think they forgot to add that that can cut both ways at times. The Lake District is a lovely place but do keep you wits about you before you commit your cash. On balance I'd say be very very careful - it is not the joy ride we expected at the outset and it is highly unlikely to be a stress-free experience, so don't buy in the fond belief that it's all going to be terribly relaxing. The lodge and the scenery will be, but hassle may not be! If you are not sure then walk away now.

Customer Service

I suppose that's as good a place as any to discuss customer service. You might want to know how things are dealt with when things go wrong. Perhaps you should ask your park if they recognise Owners' Associations. Not only do many parks refuse to do this, but they also refuse to meet with any form of group of owners at all. I didn't expecte this when I bought my lodge and was rather dissappointed as a result.

Have you thought about renting instead?

Given that owning your lodge is going to cost you about seven thousand a year, and then you have the opportunity cost of investing upwards of 100k (Properly invested that would have to get you a couple of thousand a year even at today's low rates), have you thought about maybe just renting a lodge?

For nine thousand a year you could rent one of our dog-friendly Lake District pine lodges for all of every school holiday and bank holiday including Christmas and New Year, or every other weekend including Christmas and New Year and let someone else have the pleasure and expense of dealing with the hassle on your behalf. You'd have no money tied up and you could walk away at any time.

That's worth a thought isn't it!

About the Author

John has 4 dog -friendly self-catering holiday lodges to rent at Limefitt Park in Troutbeck, near Windermere. You can follow him on Twitter @windermerelodge

Why is Ebay asking me for my credit card info just to log in?

I tried go to ebay just to leave feedback about a purchase, but a screen popped up wanting my full credit card information just to visit the site after I lodged in. WTH? I have also noticed that on certain sites, with out trying to purchase anything, a "Verified by Visa" thing comes up asking for full credit card info. Is this a virus? If so, how do I get rid of it?

This is SCAM called "phishing". DO NOT give them NEVER any personal information.

From wikipedia:
In the field of computer security, phishing is the criminally FRAUDULENT PROCESS of attempting to acquire sensitive information such as usernames, passwords and CREDIT CARD details by MASQUERADING as a trustworthy entity in an electronic communication.

The rest of the article here: http://en.wikipedia.org/wiki/Phising

Download an anti-virus program like panda or avast, or Kaspersky, or McAfee, or Norton... (or search google for anything else)

- - - - - - - - - - - - - - - - - - - - EDIT - - - - - - - - - - - - - - - - - - - -
Robert you said: "Ebay doesn't ever do that unless they're attempting to make sure your account is legit". Well, sorry, but YOU ARE WRONG. A true company will NEVER ask you any sensitive information. They saying it by themselves. The reason is obvious. They afraid that the client will lose his trust to the company, so they NEVER ask. You must know that to avoid any future mistakes.

Building Maple Canyon Log Lodge

Tags: cabin, furniture, lodge, lodge logic, lodge logic hibachi-style grill, lodge logic pre-seasoned sportsman's charcoal grill, lodge logic sportsman grill, lodge logs, log, rustic

This entry was posted on Monday, May 10th, 2010 at 11:06 pm and is filed under bedding. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.