What’s the Difference Between a Residential Park and a Holiday Park?

Posted by Justin Allitt in Comment, May 25, 2020

Firstly, we need to look at the difference between a residential home (usually a park home, but can be a lodge) and a holiday home (static caravan or lodge but can even be a park home).

Both a residential home and holiday home come in many different styles and aesthetics, but they are different. Understanding the differences between the two is essential if you are considering buying one.  This is because what you buy will have an impact on what you can do with your home. So let’s take a look at the main difference between a residential home and a holiday home.

What’s the difference between a Residential Home and Holiday Home?

The first way to know if a home is a residential or holiday home is by the standard it has been built to comply with.

Most holiday homes are built to EN1647 standards, whereas all residential homes will comply with the British Standard BS3632. This standard ensures that the home is suitable for permanent use.

Holiday homes aren’t required to reach the BS3632 standard. this is because they are designed for short term occupation. In fact, it is illegal to live in a property full time that doesn’t conform to the BS3632 standard and you should not live in a home that isn’t BS3632 standard.

One thing to note is that many holiday lodges are now being built to BS3632 standard. This isn’t a requirement, but as many holiday parks enjoy a twelve-month site license, a residential standard build allows the holiday homeowner to enjoy use throughout the year.

Residential Park, Holiday Park or Both?

Parks can be residential, holiday or a mixed-use. This is where part of the park will be for holiday homes and the other for residential purposes.

If a park is residential, you have a ‘right of permanent residence’ which allows you to live there permanently.  It can be your full-time home.  You can live there all year, and there’s no requirement for you to have another property somewhere else.

If a park doesn’t have a right of permanent residence, then you cannot live there full time.  You would need to have another residence elsewhere. There will be limits on how long you can stay at the park.  Even if the park is open 12 months of the year, you still can’t stay there all of the time if it doesn’t have a right of permanent residence.

How do you know which type of park it is?

So how do you know what use is allowed within a park or for a particular home?  The first place to start is the site license.  This license will be available on the park’s noticeboard or in the main office.  You can also ask the local council’s Licensing Department for this information or to see a copy.  Always check this yourself and don’t take word of mouth as confirmation one way or the other.

A site license is something issued by the local council.  This lays out:

  • How many homes can be in the park
  • What services and amenities must be present
  • Any health and safety considerations

It will also state if the park has a residential or holiday home license or if there is a mixture and how this works out.  The park owner will be able to provide this information for you, and if you are buying a property, you need to know this is all in order before you make the purchase.

With the different uses come different legal considerations.  Residential park homes are covered by The Mobile Homes Act 2013, which provides better protection for park homeowners as well as a legal framework for park owners to follow.

However, holiday home parks don’t come under this act, so they don’t receive the same protections. Here are some other differences between the types of parks;

1. Holiday Home Park Details

If the park has a holiday home license, then this will also state the maximum time that can be spent on-site in any one year.  Some sites may have a maximum number of consecutive days you can occupy the property – 60 days is a common one.  The local authority is the one that sets these terms.

2. Twelve Months’ Holiday Usage

Confusingly, holiday home parks often have a 12 month’s holiday use, but this doesn’t mean you can use it for 12 months of the year.  What this means is that parks are open for 12 months a year rather than being closed during the winter, as was traditional.

However, it is part of the local authority license as to how long the park can open for and what the conditions are within that license.  So, if you are buying a holiday home, it is always essential to understand this before you complete the purchase.

3. Occupation Period

Another consideration is that a holiday home costs less than a residential park home.  One reason for this is that the occupational license for a holiday home is usually for a set time.  This might be ten years, 25 or 50 years.  But a residential park home doesn’t have set time frame and therefore could be for as long as the home, and the park is existence.

4. Residential Park Homes and Council Tax

Another big difference between residential and holiday homes is the matter of council tax.  On a holiday home, you don’t pay council tax in the traditional sense while you must pay this on a residential property, just as with any other type of home.

However, you do need to pay business rates at a price agreed with the park owner as a part of the contract when you take over the property.  If you own a second home or holiday property, you also need to pay local authority rates that are similar to those on a main residence but come as part of park contributions.  This should be laid out in the contract.

5. Letting Out a Holiday Home

If you let the holiday home to tourists or even to tenants, you can get a discount on the tax you pay.  The home does need to qualify as a furnished holiday home for this which, according to the government means it is ‘sufficient furniture for normal occupation’. 

You also need to ensure that you let the property commercially and it is available for at least 210 days a year – not including any days that you stay there yourself.  So effectively, you need to advertise it for at least 105 days to qualify for this.

6. Home Construction Standard

Another way to know if a home is a residential or holiday home is by the standard it has been built too, although this is not always the case. 

As a rule, holiday homes are not built to be permanent residences.  All residential park homes will comply with the British Standard BS3632, which ensures that the home is suitable for permanent use. 

However, holiday homes aren’t required to reach this standard because they are designed for short term occupation.  It is illegal to live in a property full time that doesn’t conform to the BS3632 and should not be done.

Residential Home or Holiday Home Insurance

Because homes come in two categories; residential or holiday, there are different types of insurance.  Making sure you have the right one is vital to protect yourself.

Residential park insurance will protect you if the home was destroyed, and you had nowhere to live.  While a holiday home insurance policy wouldn’t cover for somewhere else to live because, by definition, you should already have another home to return to.  If you have holiday home insurance and plan to let out the property, you may also need business insurance and public liability.

What Happens If You Get The Wrong Insurance?

It should be made very clear when you are buying a park home what the nature of the use permitted is and which category it falls within.

If you then use a holiday home as a permanent residence, you can be considered in breach of the contract you signed when buying or renting the property.  This can lead to legal action as it is one of the ‘severe breaches of contract’ that will feature in all legal paperwork.  It can even lead to eviction in the most extreme cases.

Residential or Holiday? Getting The Right Usage

Knowing whether a park home is a residential or holiday home is one of the first things you need to understand when considering one.  The conditions of its use are more important than anything as it will ensure you can use the property legally and correctly. 

The rules are crystal clear, and every park owner will be able to make them known to you before you consider a purchase. Alternatively, you can contact the local council to find out what license has been issued to the park.