Why buy a second home?
Ideal for those who have only a small home in town, for people who have left the countryside to work in town and miss their rural roots, and for anyone who wants a family holiday without leaving Britain.

What are the options?
Decide what you want from your second home. Is it an investment, a restoration project, somewhere to retire to, or somewhere to take the family for weekends and holidays? In recent years, developers have tailored a whole new sector of the market, namely, purpose-built second homes, on managed estates.

Can I do it on a shoestring?
Most of the developments are within two hours of London, so there are few bargains to be had. Among the best-value options are the three- and four-bedroom holiday homes on The Wiltshire Leisure Village, a golf course and country club (999-year leases are £200,000-£280,000, plus ground rent, around £1,900 and service charge, just under £2,080 per annum).

What about a bigger budget?
The New England-style lodges on the Summer Lake development near Cirencester (999-year leases are £495,000-£695,000, plus £4,000 per annum service charge). There are also two spectacular waterside developments in the Cotswolds: Lower Mill Estate is a conservation paradise, wonderful for nature-watching (don't miss the beavers), where prices go from £450,000 for a 999-year lease, plus a service charge of around £2,500 per annum. The Lakes by YOO is a settlement of super-stylish glass and timber houses, by a design-led developer that employs the talents of Philippe Starck and Jade Jagger, and which sell from around £725,000 freehold, plus around £3,000 per annum service charge.

And for a good investment?
Sandbanks, a narrow peninsula of golden sand on the Dorset coast, is one of the most valuable locations on earth, with land approaching £20m per acre. Property bought there is considered blue chip, averaging over 30% growth each year in the last decade. Sandbanks properties built for the holiday home market, fully furnished, are available from £895,950 freehold. If you want to see a good regular return on your investment, this is the place to buy: rental income in Sandbanks is £2,500-£3,000 a week in summer.

How do I finance my second home?
Unless you can pay cash, your options are to remortgage your home or to take out a new mortgage. Lenders have become vastly more sympathetic to second homers over the last few years, and many interest rates will be similar to those you would be offered on your principal home, though you are unlikely to find a 100% mortgage.

How to be tax-efficient?
Though you pay no Capital Gains Tax on your primary residence, should you sell your second home, you will be clobbered unless you have made careful arrangements. If you are part of an unmarried couple, name your second property as your other half's residence, and no CGT will be payable. But designated second homes, on purpose-built developments, cannot be anyone's primary residence, so there is no way of avoiding CGT when you sell. Properties on Sandbanks, since they are not officially designated as second homes, do not suffer from this restriction.

Anything else to consider?
Do not forget insurance – especially important if the house is empty part of the year. Your insurer will help you smarten up on security and may, sensibly, insist you instruct a keyholder to look in each week; even then, you may have to forego cover for, for example, burst pipes if the building is not lived in full time.

Do I pay Council Tax on my holiday home?
Yes, but you can apply for a rebate on the bill on your second property – the discount can be up to 50 per cent but, in the Cotswolds developments, it is just 10 per cent off.

Will the locals love me?
If you buy on one of the purpose-built estates you will be responsible for boosting the local economy. Jeremy Paxton, the developer behind Lower Mill Estates says his project has provided 200 new jobs and that the 180 or so families that visit habitually spend money with local businesses; the local pub now stocks Dom Perignon.

How does a managed second home estate work?
Maintenance of the estate, landscaping and security are taken care of, as are sporting and other facilities, for a yearly service charge. Some estates have a concierge service available to residents, which can include housekeeping, checking on your property while you are away and switching on the heating before you arrive.

What are the benefits of buying this way?
These properties make for guilt-free second home ownership. You are not hogging affordable housing that could be year-round residences for key workers – these houses were built for people like you. There is the option of rental income: most estates will manage this for you. And activities, from waterskiing to birdwatching, are often offered as part of the package, included in your service charge.

Is it good for children?
Families are these developers' prime market. Anton Bilton of Raven Group, one of the developers behind The Lakes at YOO describes his aim as providing second homers with a sort of Notting Hill garden community experience. Children can play outside in a safe environment, with other families they know.

What are the drawbacks?
You are can use the property for only eleven months of the year (most are closed during January or February). Estates may have their own rules and regulations, on noise and exterior decoration, which residents must comply with. In the especially manicured examples, it can feel more like holidaying in an upmarket, self-catering resort than in your own home.

Is it for me?
If you need to entertain the children in a safe but rural environment, these second home developments hit the spot. If your dream is a crumbling old croft in a remote location, where you can get away from humanity, these little communities of new-builds are not for you.

What about buying abroad?
There is a flourishing market in second homes abroad, with a wealth of developments being purpose-built as comfortable, secure lock-up-and-leaves, in locations from Portugal and Spain to Croatia and Canada. An apartment in Albufeira, the Algarve can be had for under £50,000. If sunbathing by the swimming pool is not exciting enough and you have six figures to invest, foreign nationals can buy plots or newly built properties on Gondwana Game Reserve in South Africa, where you can learn to take your own game drive (safari), take flying lessons at the local airfield, and go whalewatching in nearby Mossel Bay (www.pamgolding.co.za).

Useful contacts
Lower Mill Estate, www.lowermillestate.com
The Lakes by YOO, www.thelakesbyyoo.com
Summer Lake, www.the-landings.co.uk/summerlake
Holiday homes in Sandbanks, www.vividhomes.co.uk
The Wiltshire Leisure Village at The Wiltshire Golf & Country Club, www.the-wiltshire.co.uk

WORDS KATRINA BURROUGHS