Firstly, from a holidaymaker’s point of view, the desire to book a stylish holiday let in the UK remains solid and is growing. Joby Mussell, chief commercial officer at holidaycottages.co.uk, noted: “Current demand for our holiday lets is strong, with bookings taken through June, July and August up 14% year-on-year, whilst the full year, taking into account the off-peak months, is up 4% year-on-year.”
Tom Burdett, director of StayCotswold, said demand for bookings is higher than ever, “with annual bookings to the end of July 2025 13% ahead of the same period last year.”
So, it seems that holiday letting agents are reporting excellent booking numbers in the current climate, which means that the business model for holiday lets is still viable and becoming a holiday let owner continues to be a coveted plan for many.
Holiday let mortgages more competitive and more properties on market
From a broker’s point of view, interest rates have fallen; holiday let mortgage products are more competitive than they were a year ago and are now not dissimilar to buy-to-let (BTL) mortgage rates.
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Add to this the fact that some local councils are charging higher council tax rates on second homes, which has caused a flood of quality properties to hit the sales market as people sell up to avoid the extra costs.
A quick online search shows that house prices have fallen in key holiday let hotspots, such as an 11.9% drop in North Norfolk, 8.1% in King’s Lynn and West Norfolk, 6.4% in East Devon, and 5.4% in Cornwall. This is creating a real buying opportunity for new holiday let investors who are keen to get into the market for the long term.
At Holiday Cottage Mortgages, our own internal data is suggesting that holiday let investors have accepted the changes imposed by the government, factored them into their long-term business plans, and are pressing ahead and snapping up some of the excess property that has come to market.
Looking at the latest figures, while the overall number of visitors to our site declined slightly, the percentage of those visitors who created an account and started the mortgage process almost doubled.
Holiday let pricing has also been falling, with some major lenders lowering rates by up to 0.4%, which will improve choice and affordability for borrowers.
To summarise, the holiday let market is as strong as ever and brokers should feel confident to operate in the market. New customers continue to appear, as holiday letting remains popular and has great potential to reap financial rewards. In fact, the market appears to be more ‘serious’ than in the recent past and clients are now pressing ahead with their plans, wanting to secure a mortgage and complete their holiday let transactions quickly.
