Case Study: Edinburgh Holiday Let with Mike Addington


Whilst browsing facebook one evening the video for this project popped up on our feed. We are a sucker for both good videography and industrial interiors so it caught our eye, but once we got chatting to Mike (whose project it was) we were even more impressed.

Unbelievably it was his and his wife Julie’s first project and with no prior experience they jumped straight into the serviced accomodation strategy, with great results. I’ll hand over to Mike (Addington!) now to share more details. 


I’ve always had an interest in property and had a desire to invest, but have always seen it as somewhat out of reach as I didn’t have the funds required. Had I read ‘Rich Dad, Poor Dad’ 20 years ago I’m sure my property portfolio would look a lot different now!

How It All Started……

In the back of mind I knew that investing in our own home would be a good place to start. With a little help from our parents, we managed to take our first step onto the property ladder and purchased our first flat in February 2014, a two bed tenement in the popular area of Comely Bank, Edinburgh.

Mike & Julie’s First Investment Property

Over the years I kept an eye on the local market and could see that the prices were rising rapidly. I knew we had a lot of equity in the flat so I set about learning how I could release some cash to reinvest in property. Podcasts were a huge source of information (including IPI) and after a lot of discussion we decided to remortgage, biting the bullet and paying the early redemption fee of over £3,000 on our 5 year fix. It turned out that over the three years we had owned the flat, the value had risen from £230,000 to £350,000, giving us a good chunk of equity to reinvest.

Investment Property


Julie and I have always been fans of Airbnb, having used it for years when visiting the likes of Croatia, Brazil, Argentina, Chile, Slovakia, as well as in Scotland. Everytime we would stay in an Airbnb I would go over the figures in my head, calculating potential income and estimating their mortgage payments. Each time I came to the conclusion that they must be making a killing!






This had obviously stuck in my head as we never really considered any other strategy when it came to investing. We had the added advantage of living in the centre of Edinburgh, possibly one of the best cities in the UK for Serviced Accommodation. The city is the second most visited city in the UK, after London, and benefits from big events such as Hogmanay, 6 Nations, Marathon Festival and, of course, the Fringe Comedy Festival.


Having decided that SA was right for us, we looked into the best areas for this strategy. Edinburgh is a very saturated market for SA and we knew we’d need to stand out for it to be a success. We thought about the important things to us when we travelled using Airbnb and what would be appealing to tourists. After lots of viewings and a few unsuccessful offers, we narrowed our search down to Dalry, an ‘up and coming’, quirky area, close to the city centre with excellent transport links – all things we thought would be attractive to prospective guests.

Edinburgh Pricing

Generally property in Scotland is sold using a sealed bid system. You get the valuation of the property in the home report and offers are submitted based upon this. At the moment it is very much a sellers market and flats are usually sold anywhere between 5% & 15% above valuation. Although there are deals to be had on property in Edinburgh, being new to the industry we decided that the usual form of purchasing property was our best option to begin with and it wasn’t vitally important to get BMV as we knew that the figures should still stack up.

On 25th May 2017 we exchanged on a 1 bed, 42m² flat in need of a full renovation. Our offer of £135,300 had been narrowly successful at 13% over the £120,000 valuation.

The Renovation

Our initial plan was to project manage the renovation with little hands on work ourselves. A deadline of the beginning of August was set as we were expecting our baby on the 7th and the Fringe Comedy Festival would be a great time to open up to the market…….financially at least.

Kitchen Before & After

Rather than hiring a builder to carry out the works and manage the trades, we decided to project manage ourselves. This proved to be our biggest mistake and ended up costing us a lot of time, effort and stress!

In the main we employed trades to carry out the skilled tasks, i.e. plumber, electrician, joiner, decorator, tiler, etc. However, we fell into the trap of doing much more hands on work than we’d initially planned. This generally happened because we’d get a quote, i.e. £1,700 to sand and lacquer the floor boards, and I’d think I could do that in a weekend for £200 (the cost probably wouldn’t be too far out but the time it took could be multiplied by 4 or 5!). As a result, I found myself doing much of the non-skilled works at the weekends and in the evenings which took its toll on the schedule.

Managing Trades

Other than the late evenings working away with the IPI podcast as my only source of entertainment/motivation, without doubt, the hardest part was organising and managing the trades.

We found some absolute gems, our decorator for example, who is a perfectionist and finished the flat off to the highest of standards. But we also encountered some trades at the opposite end of the scale who caused an enormity of stress, most notably the tiler and joiner.

Copper Pipework in the bathroom

The tiler was found through Gumtree (as was our decorator) and came across very well when he came to quote. His price was very reasonable too. The problems started with delays to the work, only very small amounts getting done with the explanation that he was having major issues with his previous job and was having to resolve that before he could dedicate his time to us.

This wasn’t a problem to begin with as we still had plenty of time, but there came a point where he was starting to hold up other work and we had to apply pressure for work to progress. We started to see more tiles on the wall but we also started to hear more and more tales………not being able to afford his rent due to the problems with the previous job, dropped his phone in the jacuzzi, couldn’t drive in because it was raining and he had no wipers on his van, the dog ate his tile cutter, etc, etc.

We stood strong and came to an agreement that we’d pay him half the money once he’d tiled the bathroom (about half of the entire job). Once the bathroom had been tiled and 50% of the money paid, he came and collected his tools, never to be seen again! Luckily we found another tiler who finished the job for us but said he’d never seen such poor tiling before.

We were actually contacted by a woman who saw a review I’d left for the first tiler. He had given the same excuses to her parents and was nowhere to be seen. Unfortunately her parents had paid him upfront and had nothing to show for it.

The kitchen, bought from Magnet using the amazing LNPG discount, was fitted by our first joiner. Once he’d completed most of the work and came to fit the end panel and kick boards, he realised he’d fitted it all 20mm too high. Without our consent, he tried to cover his mistake by cutting the end panel down to be level with the bottom of the units.

Dining Area

This left a gap that stuck out like a sore thumb when you sat down in the living room. Once he’d resolved the issue, at his cost, we hired a different joiner to carry out the rest of the joinery who turned out to be amazing and did an outstanding job with all the doors, skirting, architraves, window surrounds, etc.


When we went looking for a tiler we only got two companies to come round and quote, one of which didn’t even submit a quote after their visit. Because of this, we took the easy route and just hired the other tiler. The big lesson to be learnt here is to get at least three quotes. Yes it takes time to find, meet and discuss your requirements with trades, but hiring the right person to begin with will save you hours of time and stress overall.

The mistake we made with our joiner was a lot more simple, we didn’t go with our gut feeling. We had visits from two joiners, received very similar quotes, had a much better feeling about one guy than the other, yet for some reason we are decided to go with the one we didn’t like as much, a decision we still don’t understand!

Looks do Matter…

I believe that there are three key principles to a successful SA:


The location was set and we were happy with our choice, 30 minutes from the airport on public transport and a 15 minute walk to Princes Street. Now to focus on the appearance and comfort.


In order to stand out against the competition I knew that the look of the flat was key. Design is an area I really enjoy and this was an opportunity to put my stamp on it. I truly believed that it was vitally important to spend time on special design features, a view not shared by Julie at the time who was having to take on the vast majority of the child care which she was understandably finding very difficult and we would have many discussions about the best use of time.

However, I persisted and as a result, items like the exposed extraction ducting, exposed copper pipework in the bathroom and the TV stand made from scaffolding really make the flat stand out against other listings in the area and we have had many bookings because of this.  Julie finally agrees it was worth it but questions the timing!


Personally, the difference between an enjoyable stay and a nightmare stay for me is comfort. I recently stayed in an amazing hotel in Birmingham that had some brilliant design features and nice little finishing touches, like a coffee machine and complimentary mini bar. I was really enjoying my stay until I went to bed……….the mattress was so poor I barely got a wink of sleep.

Exposed ducting

We spent a lot of time looking into the bed and purchased a super comfy mattress from Ikea, added a down mattress topper and bought very high quality pillows, duvet and linen. The bedding and linen costs were probably our biggest shock, spending well over £1,000, not including the mattress or bed frame.

Again, this was something I felt very passionate about and it has paid off; we have had some outstanding reviews highlighting the bed one of the key features of the flat.  A few guests have even asked where we bought the mattress and bedding from so they could replicate it in their own home!


Our initial deadline of 7th August slipped quite dramatically. We welcomed our daughter Sadie into the world on 9th August (at home – unplanned – another long story!) and we pretty much took a month off from the project to enjoy time with our new addition to the family. Along with all the other issues and trying to do too much work ourselves, we were heading towards completing at the end of the year.

A new Project Manager arrived half way through the build

As fate would have it, two different friends were visiting Edinburgh the 1st weekend of December and each needed accommodation for one night, one on the Friday, one on the Saturday. This gave us the opportunity to set a firm deadline and have two ‘dry runs’ at being SA hosts.

With many late nights leading up to December, we managed to get the flat almost entirely finished for our friends’ arrival with only a few minor snags to complete the following week. We used the rest of December to find our feet as hosts and build up reviews, offering the flat at a discounted rate.

Since January the bookings have taken off, with only two nights empty nights so far in 2018. We’ve also got some great bookings for the summer, especially during the festival where we are achieving prices of up to £250/night – not bad when you consider our mortgage is less than £300/month!


The management of the flat works perfectly with both of our skill sets. Julie has experience in project management and has fantastic communication skills so she has taken on the role of guest communications along with managing the cleaner, keeping items stocked, etc. I am much more suited to the financial side of the business, setting pricing, paying bills, optimising systems and planning our future strategy. As a team, we appear to be doing quite well so far, lets hope it continues!

Industrial TV Stand


During the renovation there were many late evenings where I questioned what I was doing working away into the small hours, missing large chunks of my daughters first weeks/months. In hindsight, we should have got a builder to carry out the full renovation and this is a lesson learnt that we will carry forward to our next project. Having said that, there was definitely a lot of knowledge gained from undertaking so much of the work ourselves that it will stand us in good stead for the future.

It hasn’t all been plain sailing since going live either, SA seems to have a way of throwing up surprises every now and again and you have to be ready to react. We’ve had small things like guests asking when breakfast will be served, to bigger things like getting a phone call late one evening informing me that the toilet waste pipe had disconnected, flushing his child’s poo all over the bathroom floor. This has been my lowest point – cleaning up guest poop while recovering from a sickness bug!!


We now have our first SA up and running at 99% occupancy, profiting anything from £700/month during off season to an expected £2,500+/month during the festival. It has fulfilled one of our aims of supporting us financially while Julie is on maternity leave, though we are saving as much as possible and plan to reinvest all profits once Julie returns to work.

Although we had to pay 13% above valuation for the flat, the model still works and we are expecting around 20% ROI before you include capital growth. We should be able to pull at least £20k back out next year when we refinance which would also increase our return on capital employed.

The Future

It was always the plan that our first SA would be a working model to test the theory. By nature, I’ve always got my head in the clouds and have grand ideas, so to say that it has turned out better than I could have imagined would be a lie! That doesn’t mean that I’m disappointed in any way. The profit margins are fantastic and I would say that the test case has been proven.

Over time we will add to our personal portfolio of SA’s once we have accumulated enough capital to reinvest. This will likely be carbon copies of the same model though I am interested in bigger projects in the Highlands further down the line. As I write this I’m in an Airbnb in Aviemore and I’m assessing the market!

The more immediate focus is to work with investors, using the same model again and sharing the returns. For this venture I’ll be teaming up with another local SA provider who I’ve got to know well over the last year. We already have over £100K of confirmed investment with plenty more interest and are hoping to secure our first property in the near future.


  • Purchase Price: £135,300
  • Renovation: £20,860
  • Furnishings: £5,243
  • Outgoings: £543 pcm average based on six months data
  • Income: £1,759 pcm based on six months data
  • Profit: £1,215 pcm based on six months data

Book a stay at this apartment here.

Contact Mike here.


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