short-term lets staycation

Mortgage applications are soaring for UK short-term holiday lets

With demand high for short-term holiday lets from holiday-makers, there has been a rise in investors applying for mortgages for this type of property investment.

The latest figures from Hodge Bank show there has been a spike in mortgage applications for short-term holiday lets. These kinds of accommodation are in high demand as many holiday-makers are planning UK staycations for the spring and summer.

Hodge Bank has revealed the most popular destinations for holiday let buyers. The south-west is the most popular region with 39% of purchases. Wales follows with 19% and the north-west with 12%. Many are forecasting coastal spots and national park areas, such as the Lake District, will be particularly busy this year.

Emma Graham, business development director at Hodge Bank, says: “Many people have not been able to holiday abroad for more than a year now and staycations have therefore become hugely popular.

“We think this has almost certainly led to people re-evaluating their finances, as well as holiday plans and the holiday let market is looking very healthy.”

Mortgage options for holiday lets

Lenders are expanding their offerings to meet this growing demand in the short-term holiday let sector. In the past year, more lenders have opened up mortgage options for this type of property investment.

The data from Hodge Bank shows buyers are willing to pay £403,143 on average for a holiday home. This is nearly two thirds higher than the average house price in the UK. Of those buying a holiday let, 35% re-mortgage their existing home to finance it, and 65% take out a new holiday let mortgage.

Research by Moneyfacts reveals the number of holiday let mortgage options has increased substantially. Mortgages for these kinds of property investments have grown by 45% over the past six months. Product availability has even doubled since August last year.

Rachel Springall from Moneyfacts comments: “Consumers may have taken some time to reflect on staycations in light of uncertainties surrounding international travel and how a holiday let could be a worthy investment.

“Lenders have moved over the past six months to cater to the demand for those looking to invest in property, as there has been a rise in holiday let deals of 45%, and product availability has in fact doubled since August 2020.”

UK staycation boom

Lockdown restrictions have been easing in recent weeks. And from Monday 12th April, UK staycations are allowed in self-contained accommodation for members of the same household. Since Prime Minister Boris Johnson first announced the roadmap out of lockdown, there has been a surge in searches and bookings for short-term holiday lets.

Last-minute ‘minications’ became extremely popular last summer after lockdown restrictions eased. This will likely happen again this spring and summer. With there still being uncertainty around international travel, more people are deciding to remain in the UK this year.

Even before the COVID-19 pandemic, there had been a rise in demand within the short-term let sector. It’s become more common for holiday-makers to want to stay in private accommodation in city, coastal and rural destinations.

Attractive yields and tax advantages

There are a number of benefits to this kind of property investment. With a rise in demand for short-term holiday lets, there is room for growth in the sector. For starters, yields have the potential to be higher than traditional buy-to-lets.

From a tax perspective, furnished holiday lets are treated different to buy-to-let properties. A holiday let is liable to business rates instead of council tax if an owner intends to make the property available to let for 140 days in the upcoming year.

Short-term lets have become a go-to option for property investors. And there will likely be even greater take-up from investors in the coming months and years with increasing interest in UK staycations.

At BuyAssociation, we have a number of short-term let property investments available. For more information, get in touch.

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:


Sign up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
Manchester property investment


Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:


+44 (0) 333 123 0320

Open from 9am-6pm GMT


+852 6699 9008

Open from 9am-6pm HKT