We first started to think about the idea of "downshifting" three years ago. Both aged 27, we found that work was taking over our lives. We had drifted into well-paid jobs in London but dreamed of cutting the number of hours we worked. We also knew we wanted the chance to be at home as much as possible when we have children.
But I found it hard to think of a way out. My job as editor of a business magazine brought in almost pounds 35,000 a year. But it could only ever be a full-time job, and I did not relish the prospect of going freelance given its insecurity and the high cost of London living. Jane's position was different: as a primary school teacher she could work anywhere in the country and there are more chances for her to work part-time.
Eventually we hit upon the idea of opening a guest house. Jane's parents' background as hoteliers and our shared interest in interior design made us think we could make a go of it. We'd also identified a gap in the market: whenever we stayed in guest houses we felt we were trespassing in places meant for older people. We were sure there would be plenty of people like us who wanted a younger, more stylish place to stay.
Our plan was that the guest house would give us a core income, and as it would take relatively little time to run, would allow us to take on other work. We started searching in the Lake District and last October we found the right property in Windermere. As soon as we saw the place we knew we had to go for it. It was a former Victorian coach house and needed a lot of work. But it had the space to create five large, en suite rooms and still give us the entire ground floor as private accommodation.
We had to apply for planning permission for a change of use to a guest house, and we needed a commercial mortgage to buy it. This meant serious money: we had to take out a 25 per cent deposit as a bridging loan until we could sell our London home. We had to borrow more money to fund the conversion, and then take out a personal loan to buy the furniture.
Jane and I had to carry on working in London until the work was finished. At this point we were stretched to the absolute limit. We were paying two mortgages, and debts were mounting on the guest house. Then we found that the conversion was going to cost a lot more than our original estimate.
We have managed to sell our London home, which has eased the financial pressure, and we moved up to the Lakes full-time at Easter. Before opening we researched what other similar guest houses were charging to make sure our rates (from pounds 26 per person per night) are competitive. Once established, we think the guest house should make an annual profit of pounds 18,000.
Our mortgage is conditional on one of us also bringing in a salary, so Jane has started a pounds 17,500 teaching job locally. I run the business and have started to take on some freelance journalism. We are both hoping that the need for outside income will decline as profits at the guest house build up.
Running a guest house is a seven-day-a-week job in high season. But we only offer bed-and-breakfast and employ staff to help out, so the work is done by lunchtime. Even in high-demand areas like the Lakes the season only runs from mid-February to mid-November, giving us three months.
We're prepared for business to be slow in the first year. We opened too late to get into most of the summer 1998 guide books and have yet to be inspected by the English Tourist Board, AA or RAC. Until we get a rating from them, tourist offices won't pass on visitors to us. But plans are in train to get this sorted out. We also hope to attract business from our target audience of younger people by advertising on the internet.
The guests at our opening weekend gave us lots of positive feedback and our frayed nerves should be soothed in no time. Tom and Barbara Good, move over.
q The Coach House, Windermere: 015394 44494.
How to buy a guest house
q Choose your area carefully and do lots of research. Talk to the local tourist board and guest house owners about levels of demand before you produce a business plan.
q You'll need to come up with a 25 per cent deposit if you need to borrow a large sum on a commercial mortgage. We saved like crazy (by taking out a 10-year mortgage on our London house we made hefty payments each month but freed up a lot more capital when we sold up).
q Commercial mortgage interest rates are higher than for residential mortgages, and can be anywhere between 1 point and 5 points above the base rate.
q If you are taking over an existing business you may be able to prove that income levels will be enough to pay the mortgage. But if you are starting from scratch the lender will probably insist on some other source of regular income.
q Push for discounts when you buy furniture and fittings in bulk.
q If you let to six people or more you need planning permission and must meet fire regulations. Guest house insurance policies are also more expensive than ordinary schemes.
q It is extremely hard to control costs when renovating property from a distance. Make your estimates very generous and if possible have someone supervise the work on site.