Reality Check: So you want to open a bed & breakfast?

This 5 bedroom house on a 5952sq m property at Te Wahapu near Russell village would lend itself perfectly to being run as a bed and breakfast. There are 3 bedrooms in the main part of the house, plus 2 more and a second living area in a separate wing. There is third separate space below the house that could also be used for guest accommodation. It has glorious views over the bay and its own mooring. It's for sale for $1.475 million. Contact Charlie Brendon-Cook, Russell Realty, ph 021 403 723.

Have you struggled back to work in the big city nursing a daydream of chucking in the day job and opening a chi-chi country bed and breakfast? Spending your days entertaining the good and great, picking herbs from the garden and being photographed for the lifestyle magazines? Turning the cash-hungry lifestyle property into a profitable business and kissing goodbye to the boss and the mortgage?

Be warned: if you do not do careful homework on the business of running home accommodation (or guest and hosted, as it is known in the trade) the dream may turn out to be more Fawlty Towers than The Good Life.

Whether you call yourself a B&B, farm stay or boutique lodge, once you open your home to paying guests, you become part of the hospitality industry, with all its accompanying responsibilities and obligations. Long-term hosts are in the business because they love people and don't shirk hard work.

Join the industry experts

Even if your dream is a distant one, start educating yourself now so that when your dream property comes up, you have a head start. Browse the websites, sign up for the getting started newsletters, courses or books from the leading tourist organisations such as @Home New Zealand (The New Zealand Association of Farm & Home Hosts) or the Tourism Industry Association (www.tianz.org.nz). Hunt your bookshops, amazon.com or libraries for handbooks and business guides. Know your local authority regulations: by-laws differ around the country. At a minimum you will need to understand what your local zoning allows as a permitted activity or whether you will need a dispensation or resource consent. Then talk to inspectors for buildings (things like accessibility, kitchen and food handling design), fire safety (codes are very specific about smoke detectors, extinguishers, exits and evacuation procedures), and, if you plan to offer food, health and food handling.

Think of your business structure

Consider how you want to run your home business: bear in mind this is a business, so you will have to meet GST, ACC and other taxes, plus comply with laws to do with employment, health and safety and sale of goods. Your insurance companies need to be fully informed, and you will probably need to add public liability and more extensive fire and general to the usual homeowners' plans to fully protect you and your guests. Do you plan to employ staff or outside services for cleaning, laundry, gardening, driving and so on or do it all yourself?

What kind of host do you want to be?

Unlike a hotel or motel, home hosting generally requires some interaction with guests. This can range from a self-catering guest cottage to bed and breakfast, through to full meals, touring or other activities. Just how hands-on do you want to be? Good food is a minimum requirement of most guests, so be prepared to devote quality time to plan, shop and cook. Think about how much personal interaction you want (how will guests and pets and family interact, or not?) Can you add on (or access other locals to provide) services like airport pick-ups, massages, guided tours and more?

Find your guests

Building a well-used service takes time. Be aware that home hosted occupancy rates averaged 27 per cent last year compared to 56 per cent for hotels and motels.

Go to the tourism New Zealand website to check your competition (www.newzealand.com), then browse the web for tourism reference sites to which you could belong for bookings. Again, the industry organisations can help you come to grips with things like retailers and wholesalers, commissions, credit cards, bookings and so on.

Like any business, a great bed and breakfast takes a few years to build up to a paying proposition. If you are serious about your passion for your home and for other people, you'll love every minute.