What is a holiday let or serviced-accommodation mortgage?
A holiday let or serviced-accommodation mortgage is specialist buy-to-let finance for property let to guests on a short-term basis — nightly or weekly through booking platforms — rather than to long-term tenants on an assured shorthold tenancy. Because the income is seasonal and variable, lenders assess these deals on projected occupancy and blended seasonal rates rather than a single monthly rent. This is unregulated lending aimed at professional landlords and is a distinct product from a standard buy-to-let.
How is a holiday let different from a standard buy-to-let?
The core difference is the letting model. A standard buy-to-let is let to one household on a long tenancy at a fixed monthly rent. A holiday let is occupied by a stream of short-stay guests, so income rises and falls with the season and depends on occupancy. This makes the income potentially higher but less predictable, and it changes how lenders underwrite the deal, how the property is managed, and the tax treatment. It also differs from an HMO, where multiple tenants share a single property on longer lets.
How do lenders assess short-term let income?
Since there is no single monthly rent, lenders build a picture from seasonal projections. A common approach is to take the average of low, mid, and high-season weekly rates, apply a realistic occupancy assumption across the year, and run the resulting income through a rental stress test with an ICR, much as with any buy-to-let. To support the projection, lenders usually want:
- A letting projection from a specialist short-let agent
- Evidence of actual bookings or historic income where the property already trades
- Comparable local short-let performance
- Confirmation of any planning or licensing requirements for short-term letting
A demonstrable track record of bookings materially strengthens an application, because it replaces a projection with real numbers.
How much deposit do you need for a holiday let?
Holiday let and serviced-accommodation mortgages typically require a deposit of 25-30%, so a maximum LTV of around 70-75% — a little more than mainstream buy-to-let because the income is seen as more variable. As always, a larger deposit improves the rate and helps the deal clear the stress test. Our guide to buy-to-let deposit requirements covers how LTV and deposit interact.
What do holiday let mortgages cost?
As a general guide for the 2026 UK market, expect pricing a little above standard buy-to-let:
- Interest rate: typically around 5.5-7% depending on LTV, location, and experience
- Arrangement fee: often 1.5-2% of the loan
- Valuation: may include an assessment of short-let income potential
Holiday lets can generate substantially higher gross income than a long-term tenancy, which often more than covers the extra borrowing cost — but returns depend heavily on location, seasonality, and running the property well.
What about planning, licensing, and tax?
Short-term letting is increasingly subject to local rules — some areas require planning permission or registration for short-term lets, and holiday-let tax treatment has changed in recent years, affecting the reliefs available. Lenders will expect you to be compliant, and the tax position influences whether to hold the property personally or in a company. Take specialist tax and planning advice for your specific location before you buy, as the rules vary considerably around the UK.
How do you arrange a holiday let mortgage?
Holiday let and serviced-accommodation finance sits with a specialist group of lenders, each with its own approach to income assessment and location. Assesr packages your deal — the seasonal projections, any booking history, the location, and your experience — into a lender-ready credit paper in around 60 seconds and matches it to specialist buy-to-let finance lenders active in short-term lets. You pay nothing until completion — just the 0.5% Assesr Fee on drawdown, a quarter of the typical broker fee.
Frequently asked questions
What is a holiday let mortgage?
A holiday let mortgage is specialist finance for a property let to guests on a short-term basis, such as through booking platforms, rather than on a standard assured shorthold tenancy. Lenders assess these on projected seasonal income — usually a blend of low, medium, and high-season weekly rates — rather than a single monthly rent.
How do lenders assess serviced accommodation income?
Because short-term income is variable, lenders typically take an average of low, mid, and high-season weekly rates across the year and apply an occupancy assumption, then run that through a rental stress test. Some want a projection from a letting agent, and a track record of actual bookings strengthens the case considerably.
Do holiday let mortgages cost more than standard buy-to-let?
Usually a little more. Because short-term letting income is seen as more variable and management-intensive, holiday let and serviced-accommodation rates and deposits tend to sit above standard buy-to-let, often needing 25-30% deposit. The higher gross income these properties can generate frequently offsets the extra cost.