New mortgage deal for holiday buy-to-let landlords
Landlords hoping to benefit from the growing trend for staycations and Airbnb short-stay trips can now take advantage of a new holiday let mortgage product.
Specialist lender Together has launched a mortgage product which allows landlords to buy properties for rent out on a short-term basis.
Similar products are provided by firms such as the Leeds and Bath building societies - but Together's offer is thought to be the first from a specialist lender.
A growing number of investors are turning to holiday lets or serviced accommodation apartments as an alternative to traditional buy-to-let properties.
Marc Goldberg, commercial chief executive at Together, said: “Our aim is to support landlords and investors by providing innovative finance products that are tailored to their needs. Holiday lets can deliver high yields and there’s strong market demand, so we’re delighted to launch this new product which we believe will complement our existing offering in this sector.”
The market for holiday lets is buoyed by record numbers of tourists visiting the UK – estimated to be 40m this year – and more Britons staying at home for their holidays post-Brexit.
Loans of up to £2m are available for purchase or remortgage, and terms range from four to 30 years, with a minimum five-year term on fixed-rate loans.
Landlords can get a loan-to-value of up to 65 per cent. The rates are 7.99 per cent plus a 2 per cent arrangement fee.
Alex Huntley, Head of Operations at Simple Landlords Insurance said: “We’re seeing more landlords seeking to diversify their portfolios to meet the challenges of the changing property market. Holiday lets and serviced accommodation apartments are increasingly popular - but it’s all about occupancy levels.
“It’s hard work making sure you’ve always got guests, and turning round your property between them. Landlords should also be aware that they’ll need specialist insurance to cover these properties, and should factor those costs in before they consider investing.”