How lenders treat holiday lets
Lenders differ on holiday lets. Some treat them as residential investment, some as commercial property with a lower loan to value, and some exclude them altogether. Location matters: a cottage in an established holiday area with a letting history is easier to fund than an unusual property in a remote spot.
Properties on holiday parks or in holiday villages, lodges and static caravans are often excluded, because of restrictions on occupation and limited resale markets. Lenders generally prefer standard houses and flats that could also be sold or let on the open market.
Rules on short-term letting
The rules depend on where the property is. In Scotland, short-term lets need a licence from the local council. In Wales, councils can charge higher council tax premiums on second homes, and to be rated for business rates a self-catering property must be both available and actually let for set numbers of days each year. Some Welsh councils also use planning controls on new second homes and short-term lets. In London, letting a home for more than 90 nights a year generally needs planning permission.
Leasehold flats may have lease terms that prohibit short-term letting, and restrictive covenants can apply to houses. Lenders' solicitors will check, and it is worth confirming early that your plans are allowed.
Tax and the exit
The furnished holiday lettings tax regime was abolished from April 2025, so holiday lets are now generally taxed like other residential lettings. That has changed the numbers for some owners, and you should take tax advice on your own position.
The usual exit is a holiday let mortgage. Those lenders typically assess affordability on projected holiday income, often using an agent's letting forecast, and some set minimum income or experience requirements. A sale is the other common exit. Allow time in the bridge for any works, the first letting season if a lender wants to see trading, and the refinance to complete.
Arranging holiday let bridging
A clear case includes the purchase details, an agent's letting projection or past booking records, details of any works, and evidence of the exit. We compare the lenders that accept holiday lets on loan to value, terms and property restrictions, then approach those that fit.
Instant Quotes gives indicative figures as a starting point. Final terms depend on each lender's valuation and checks.
If you or your family will use the property
If the borrower is an individual or the trustees of a trust, and the property is, or will be, lived in by you or a close family member, the loan may be a regulated mortgage contract with additional protections. We will tell you at the outset if that applies and how your case will be handled.
Your home or property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
