Buying a Holiday Home or Airbnb? Your Complete Guide to Mortgage Options

From The Residential Mortgage Hub

The UK staycation trend is here to stay, and so is the growing interest in holiday homes and Airbnb-style lets.

Whether it’s a quaint cottage in Cornwall, a peaceful lodge in the Lake District, or a chic seaside apartment in Whitstable, more buyers are looking into buying a holiday home in the UK. Many want the best of both worlds, a place to enjoy themselves, plus income from short-term letting.

But here’s the important bit, securing a holiday let mortgage is not the same as buying your own home or getting a standard buy-to-let mortgage. Lenders have unique rules, and the right product choice is crucial from the start.

What Buyers Typically Want to Do

Most holiday home buyers fall into one of three categories:

1. Personal Holiday Home Mortgage – Property for private use only, with no letting.
2. Airbnb / Short-Term Let Mortgage – Rented to guests on platforms like Airbnb or Booking.com, with some personal use.
3. Traditional Buy-to-Let Mortgage – Long-term tenants only, short-term holiday rentals not allowed.

The most popular right now is the Airbnb-style short-term let, giving owners both personal getaway time and extra income.

Mortgage Options for Holiday Homes

Holiday Let Mortgage

Specifically designed for properties rented on a short-term basis,

• Works with Airbnb, Booking.com, Sykes Cottages, and similar platforms.
• Affordability based on seasonal rental income projections.
• Property must be available to let for a set number of days each year.
• Personal use often allowed for 90–120 days annually.
•  Lenders may ask for a forecast from a local letting agent or use past Airbnb income if remortgaging.
  Example lenders: Leeds Building Society, Principality, Suffolk BS, Furness BS, and more.

Second Home Mortgage (Residential)

For buyers who won’t be renting out their property,

• Must prove you can afford both homes.
• No rental income considered in the affordability check.
• Usually cheaper rates than holiday let mortgages.
• Short-term letting is not permitted.
  Ideal for those buying a private retreat or a future retirement property.

Buy-to-Let Mortgage (Long-Term Only)

• Requires tenancies of 6+ months.
• Airbnb or short-term letting is not allowed, doing so could breach mortgage terms.
  Best for landlords sticking to standard tenancy agreements.

How Lenders Assess Holiday Let Income

Holiday let lenders calculate affordability differently from standard buy-to-let,

• Average weekly rent × 30–35 weeks.
• Income forecast from a local letting agent.
• Annual gross rental projection.

Some lenders also apply a “stress test” at a higher interest rate to ensure the mortgage remains affordable in future.

Key Considerations Before You Buy

Before committing to a holiday let or Airbnb property, your solicitor will check for,

• Lease restrictions – Does it permit short-term letting?
• Local council rules – Are there planning restrictions on holiday lets?
• Property type – Some lenders avoid flats or properties in holiday parks.

While your solicitor handles the legal checks, we can flag common lender restrictions early so you don’t waste time on properties that may not meet mortgage criteria.

Stamp Duty & Council Tax

Buying a second property in England means paying a 3% stamp duty surcharge on top of standard rates.
Council tax rules can vary, some areas have higher rates for holiday homes, especially in popular tourist destinations.

We’re Here to Help

At The Residential Mortgage Hub, we have access to a wide panel of specialist lenders offering,

• Mortgages for individuals or limited companies.
• Interest-only or repayment options.
• Solutions for first-time holiday let owners or experienced landlords.

📞 Contact us today for expert advice on your holiday let mortgage or Airbnb mortgage, and let’s turn your holiday home dream into realit