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Rachel Springall

Finance Expert & Press Officer
Published: 24/01/2023
holiday home on a cliff

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Compared to October last year, there are now 173 more mortgage options on the market for holiday let borrowers.

This comes after holiday let product choice took a nosedive in the aftermath of the mini-Budget, with only 26 lenders offering deals in October.

This figure has rebounded too. Not only are there 411 different mortgage options on the market today, but there are eight more lenders. Most of these lenders are building societies, covering both fixed and variable rate options.

Is there an appetite in the market?

Due to the pandemic, there was a huge demand for UK-based holidays, so buy-to-let investors could have seen the potential to dip into holiday lets. As the holiday aspirations of consumers change, demand for UK holidays could fall, but at the same time, the country is facing a cost of living crisis which may keep them interested in a more cost-effective UK break.

However, rising interest rates may well dent the profit margins of investors during 2023 and, on top of this, the Government is due to make reforms which will impact holiday let investors.

Holiday lets will need to be rented for a minimum of 70 days a year and available to be rented out for 140 days a year, and homeowners will need to show evidence of their lettings and meet certain criteria to qualify for business rates relief. These new rules are due to come into force this April and are designed to protect legitimate investors.

Landlords may be dipping into their savings due to the cost of living crisis, and the expense to redevelop a property to a high standard may be more now than in previous years. Mortgage interest rates have risen over the past year, so it is imperative prospective landlords seek advice to compare their options and consider a fixed rate deal for peace of mind.

Investors picking a property with their head over the heart is extremely wise, and in-depth research must be done on locations and listing services to ease any concerns over letting exposure and seasonal dips.

Considering a holiday let?

If you're considering a holiday let property then it might be worth buying insurance. Read our guides on buy-to-let insurance and home emergency cover to find out more. 



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