LONDON (CU)_Over the recent months, with the pandemic bringing overseas travel to a halt, more people in the United Kingdom are going to places like Norfolk, Cornwall, Cumbria and Scotland on holiday this year. Therefore, landlords and investors have decided to capitalise on this opportunity, as rents for UK holiday accommodation continue to rise sharply.
Therefore, it comes as no surprise that number of “holiday let” mortgage deals on the market have more than doubled over the past year. Data issued by Moneyfacts recently, showed that earlier this month 186 holiday let mortgage deals available, in comparison to 74 in August 2020, which, according to one mortgage broker, reflected “really incredible interest” this year. Meanwhile, the number of lenders in the market have also increased from 14 to 25 during this period.
Holiday let mortgages are a type of buy-to-let home loan. They are often taken out by investors who buy a holiday home to rent out when they are not there and landlords who had previously let their properties to traditional tenants. The increased number of such mortgages over the recent months have been mainly offered by smaller and specialist lenders such as building societies.
“As the demand for staycations remains evident, it would not be too surprising to see more growth in this market in the months to come,” Rachel Springall, a spokeswoman for Moneyfacts, noted.
Meanwhile, many buy-to-let landlords are looking to diversify in response to tax and other regulatory changes, or to simply cash in on the trend. The situation has now created what has been described as a coastal housing crisis, and many believe that the government may launch a series of measures to clamp down on second homes, with some saying councils may be even given to power to ban them.
