There are now 320 deals for short-term let landlords, up by 72 per cent from September 2021, data website Moneyfacts found.
The firm said product numbers had nearly doubled from March 2020, with around 31 lenders in the space. The majority of these are building societies.
However, demand for holiday lets could change as government rules are introduced in 2023.
Rachel Springall, finance expert from Moneyfacts, said that with the cost of living crisis holidaymakers may choose a vacation closer to home to cut costs, which is a similar trend seen during the pandemic.
She continued: “UK holidays could then still be a profitable investment for landlords as consumers scrutinise their budgets and perhaps forego a trip abroad. Borrowers who are tempted to invest must consider the upfront costs to get a property to a high standard so they can stand out from the competition, but also prepare themselves to experience seasonal dips.”
Springall added: “There are notable government measures coming into play next year that are likely to impact the holiday let market as homeowners will need to show evidence of their lettings and meet certain criteria to qualify for business rates relief.
“Holiday lets will need to be rented for a minimum of 70 days a year and available to be rented out for 140 days a year under new rules which are to come into force from April 2023.
“It is hoped the changes will protect legitimate holiday let investors and crack down on others but may also deter potential investors who have doubts over meeting the new rules.”
