What Are Holiday Let Mortgages?
Updated: Sep 23, 2021
You might have heard of a buy-to-let mortgage, but have you heard of a holiday let mortgage? For those planning on renting out their property, this may be a much more suitable option for a mortgage.
To put it simply, a holiday let mortgage is a mortgage designed for properties that will be let out on a short-term basis as holiday accommodation, rather than renting out a property as long-term accommodation. This is a flexible option for you to invest in the holiday home market which has become increasingly attractive and lucrative in recent years.
With stay-cations on the rise in popularity and economic uncertainty making traditional buy-to-let a far less attractive option, short-term holiday lets could be a great way to get a solid return on property investments.
When compared to buy-to-let mortgages, it may be possible to rent out a holiday let for far more money than a typical buy-to-let property. This means that, provided that you can let out the property on a consistent and regular basis, you could generate a much larger income from it than you would with long-term tenants.
Additionally, furnished holiday lets are also treated differently by tax rules. Instead of classifying it as a residential property, they are classed as a business which means that you can still claim tax relief on mortgage interest. In contrast, that same relief is being reduced on buy-to-let properties.
If you'd be interested in applying for a holiday-let mortgage, Mortgage Thoughts can help you! Contact us today and speak with one of our award-winning specialist advisors to find a deal that's right for you.