For many of our clients, owning a small hotel, bed and breakfast or a collection of self-catering holiday cottages represents the fulfilment of a long-held dream. It offers the opportunity to exchange a stressful career for a very different way of life: living in beautiful surroundings, meeting people from around the world and earning enough to enjoy a comfortable lifestyle.

The key, however, is to see these properties for what they really are: not investments designed to make their owners wealthy. They are lifestyle businesses.

A well-run guesthouse or small rural hotel will almost always generate a profit in accounting terms. However, if the owners' own time were costed at commercial rates, much or even all of that profit might disappear. The owners are, in effect, creating both their home and their income through their own efforts.

For most buyers, that is perfectly acceptable.

Instead of spending forty or fifty years working simply to pay a mortgage on a house in Northern Europe or North America, many people choose a very different path. They buy a property in Spain that provides both a home and an income, allowing them to enjoy a Mediterranean lifestyle that many people only experience during a two-week holiday.

The rewards are measured in quality of life rather than financial return.

Many owners deliberately choose not to maximise their income. Rather than remaining open throughout the year, they may operate for only six, seven or eight months, generating sufficient income to support themselves for the entire year. The remaining months are spent travelling, enjoying the local area or simply living at a much gentler pace.

The ability to choose how much—or how little—you wish to work is one of the attractions of owning a small hospitality business.

The same philosophy applies to self-catering apartments and holiday cottages. A small complex can provide a comfortable income while allowing the owners to live in a location that might otherwise be beyond their financial reach. For most of our clients, living among olive groves in Andalucía or in a whitewashed mountain village is itself part of the return on their investment.

However, if the buyer is unable to fund the entire purchase through savings, a house sale etc. financing these purchases can sometimes be more complicated than buyers expect.

Spanish banks may not be prepared simply to accept the previous owner's trading figures as evidence of future income. A small hotel or bed and breakfast is often as much a reflection of the proprietor's personality, reputation and hospitality as it is of the building itself. One owner may create a thriving business, while another operating from exactly the same property may achieve very different results.

Banks are also aware that, in some small hospitality businesses, not every euro received in cash has necessarily been declared for tax purposes. Any income that cannot be verified through accounts, tax returns and bank statements will not be taken into account when assessing a mortgage application.

For this reason, buyers who require finance may also need to demonstrate that they have other reliable sources of income, such as pensions, salaries, rental income, investments or substantial savings. The bank will want to be satisfied that mortgage repayments can continue even if the business takes time to establish itself under new ownership or fails entirely.

Prospective buyers should therefore be aware that they may need to demonstrate income from alternative sources which will continue after they have moved into their beautiful new property.