You will need to ensure that your holiday let will generate a steady stream of bookings throughout the year in order to generate enough rental income for your property to be profitable.

Research potential holiday let locations thoroughly. Look for areas with strong demand from holidaymakers, as well as good amenities, nearby attractions, and easy access. Think about factors like seasonality, any local rules around holiday lets, and how much competition there is from other holiday homes in the area.

What is the demand in the area? Is it popular? If so is it oversaturated? Consider factors like proximity to tourist attractions, beaches, outdoor activities, and local events.

Assess the suitability of the property for holiday letting. Consider factors like property size, layout, amenities, and overall condition.

It’s also important to remember that holiday buy to let properties are subject to different tax rules than traditional buy to let properties. To ensure you abide by any tax obligations, we would always recommend speaking to a tax advisor to get a better understanding of this.

Understand the local rules and legal requirements for holiday lets. Check whether there are any restrictions on holiday letting in the area, including planning permission or licensing requirements. You should also make sure you have the right insurance in place, such as buildings insurance and public liability cover, to protect both your property and your guests.

Consider the risks that come with holiday let investments. These can include seasonal demand, fluctuating booking levels, economic downturns, and even currency changes if you’re targeting overseas visitors. It’s also important to have the right insurance in place to cover your property, contents and liability, helping protect your investment if something goes wrong.

You’ll need to consider upfront costs and a maintenance budget to get your holiday let property up and running - and to keep it that way throughout the year. Some of the key initial expenses to factor in include your deposit, legal fees, and any Stamp Duty that may apply.

How will the property be managed day to day? Will frequent visits be needed, and is this realistic for you? If you’re not based nearby, you may need to factor in the cost of a local property management service. If you plan to manage it yourself, consider how you’ll handle cleaning, guest changeovers and general maintenance to keep the property in good condition.

Do you have any other large loans or are you planning major life changes, such as changing jobs or growing your family? These factors could affect your ability to manage mortgage repayments. It’s also important to discuss your plans with an accountant and/or tax advisor, and seeking independent financial advice before making any commitments is always a wise step.

Holiday let mortgages are designed for properties rented out as holiday homes to guests for short stays, while buy-to-let mortgages are for properties rented to tenants for longer-term living arrangements. Lenders assess affordability and income differently for each.

No. This is one of the biggest misconceptions when it comes to buying a holiday let property. You cannot use a buy-to-let mortgage on a property that you intend to rent out as a holiday home.

No, holiday let mortgages are designed for renting out a property as a holiday home to guests, not for use as a permanent residence. However, if the property isn’t booked, you can use it as your own getaway.

Yes, lenders typically require you to have a separate main residence before applying for a holiday let mortgage. However, you don't have to own the property yourself, you could be living with parents or renting.

Yes, if you're a first-time buyer and living with parents or renting you're still eligible for a holiday let mortgage.

Yes, but lease terms and restrictions may apply. Some leaseholds or management companies don’t allow holiday lets.

Yes, the amount you pay may vary depending on the price of the property and how many other properties you own. You could also be required to pay an additional rate of Stamp Duty Land Tax (SDLT) when purchasing a holiday let property.

For more details on SDLT rates and how they apply here.

Building and contents insurance are required for holiday rentals, and public liability cover is also important to protect against guest-related claims. Many landlord insurance or holiday let insurance providers offer comprehensive policies that include these as standard.

Yes, you can purchase and operate a holiday let through a limited company. Some investors choose this route for potential tax benefits or to separate their business finances from personal ones. It’s important to speak to an accountant or tax advisor before deciding.

No, you don’t have to set up a company to own or operate a holiday let. Many owners hold properties in their personal name.

Only if you choose to operate through a limited company. If you buy and manage your holiday let property as an individual, there’s no need to register with Companies House.

Yes, you’ll need specialist insurance for a holiday let property. This typically includes buildings and contents cover, as well as public liability insurance in case a guest is injured or their property is damaged during their stay. Many insurers offer holiday let or landlord insurance tailored to this type of use.

The criteria for a holiday buy to let mortgage will vary depending on the lender you choose to go with. However, some common criteria include:

1. Minimum Deposit
You will typically be required to put down a larger deposit than you would for a regular mortgage. This usually starts at around 25% of the property’s value.

2. Property Location
The property will need to be located in a popular holiday destination to ensure a steady stream of bookings and rental income.

3. Rental Income
Lenders will typically require you to demonstrate that your holiday property will generate sufficient rental income to cover the mortgage repayments and other related costs, such as maintenance.

4. Financial Standing
As is the case when applying for most mortgages, you will need to demonstrate that you have a good credit score and a stable income to show that you can afford to keep up with the mortgage repayments.

5. Property Type
Some lenders may have restrictions on the type of property they will lend on, such as excluding apartments or properties that are not suitable for year-round occupancy and therefore will not generate income through the entirety of the year.

6. Property Management
Though this isn’t always the case, some lenders may require you to have a property management company in place to handle any bookings and general maintenance of the property to ensure its upkeep. 

It’s also worth noting that lenders may have additional criteria depending on the individual circumstances of the borrower and the property. It’s always best to speak to a mortgage advisor to understand the specific criteria for a holiday let mortgage.