Suffolk BS adds expat holiday let deal; Hodge extends rental yield criteria – round-up

The product is available up to 80 per cent loan to value (LTV) and offers a minimum loan size of £75,000 on a minimum property value of £100,000. The maximum loan size is £750,000 and it is available on properties in England and Wales.  

It has a discount rate at 3.85 per cent, 1.54 per cent lower than the mutual’s current standard variable rate of 5.39 per cent and can be used for purchase as well as remortgage. 

Applications for Airbnb properties will be considered, following Suffolk’s criteria change last month. 

In line with existing holiday let criteria, applications will be assessed on an average of low, mid and high season rental yield. This will need to be verified by an independent lettings agent rather than Airbnb. 

The annual rent must provide a minimum of 145 per cent rental coverage based on the initial pay rate plus two per cent, or a minimum of 5.5 per cent, whichever is greater. 

Expat first-time buyers and non-owner occupiers will be considered on an individual basis. For joint applications, at least one party must be a UK national where the second applicant is a non-UK national. In this case, the first applicant must satisfy Suffolk’s criteria.  

Owners may occupy the mortgaged holiday let property for personal use for up to 60 days per year. 

Charlotte Grimshaw (pictured), head of intermediary relations at Suffolk Building Society, said: “As expat and holiday let specialists, we were naturally keen to respond to the demand, both from intermediaries and direct customers, for what is currently an underserved section of the market. Although many lenders will consider either holiday let or expat applications, very few consider them together.  

“With 60 days personal use, this also provides a great base for those expats returning to the UK for longer holidays or to visit family, meaning they have a property of their own to stay in, alongside the rental income they’re earning too.” 

Hodge increases holiday let rental yield criteria 

Hodge will now accept 30 weeks’ occupancy as a rental yield projection for its holiday let mortgages.  

It previously allowed calculated rental income using an average of projected low, medium and high season weekly rental yield based on 26 weeks’ occupancy. 

The bank said it did this in reaction to the “buoyant market”, as well as the increasing rental yields across the sector. 

Emma Graham, business development director for Hodge, said: “Here at Hodge, we constantly talk to our broker colleagues and ask them how we can improve our products. They suggested a few things. We listened and now this new 30-week occupancy calculation change is being made. 

“We believe this change in our criteria will help even more people get on the holiday let mortgage ladder and offer more accommodation to the UK holiday market.”