Unlike more conventional buy to let mortgages, holiday let mortgages can be significantly more difficult to arrange. A vast majority of major lenders will not finance the purchase of a property that is primarily going to be let as short term holiday accommodation. Additionally, holiday let mortgages are deemed to facilitate a form of commercial enterprise, meaning further selection criteria may apply. In many ways holiday let mortgages are something of a hybrid financial product. On the one hand they are supporting a commercial venture and on the other hand they are being used by individuals who wish to expand their property portfolio.
The concept of investing in residential property via the buy to let market has become increasingly popular in recent years and people have been quick to indentify holiday accommodation as a possibly more lucrative and secure form of acquiring new properties. Holiday let mortgages allow the buyer to purchase a property with none of the associated risks of the standard buy to let business model. Holiday makers pay a premium for the use of holiday accommodation and they pay in advance, meaning more income being derived from a more secure stream.
Much like standard buy to let mortgages, holiday let mortgages will only usually provide 70% to 80% of the actual purchase cost of the property, borrowers will need to find a significant deposit from their own resources. Many lenders will also insist that the property in question has a minimum value of around £70,000 which in today’s property market is not such a large hurdle.
Holiday let mortgages can be a great way to achieve financial freedom by accruing property assets which quite literally pay for themselves. If we consider that the only initial outlay will often be the deposit, and that many properties will make sufficient income to fully cover the holiday let mortgage repayments, then it becomes clear that this particular form of investment is particularly attractive to those people who find they have limited funds.
The marketplace for holiday let mortgages is still fairly young and is slowly evolving into a mature field, much in the way that buy to let mortgages have developed over the past decade. Now is the time for those who are considering holiday let mortgages to act, right now the process of applying for this form of finance dissuades many people from entering the market, once the products have evolved and the application process becomes more streamlined, many people who were previously deterred from applying for holiday let mortgages are bound to revisit the option once more. The market will become flooded and the real bargains and profit will begin to dry up.
If you are seriously considering holiday let mortgages as an option to build your personal wealth by acquiring a portfolio of holiday accommodation, then you are advised to seek the advice of a professional broker, who will be able to assist you in finding the best holiday let mortgages for your needs.
Enhanced Wealth are a specialist provider of holiday let mortgages, you can visit our dedicated holiday let mortgage website here http://www.holidayletmortgages.co.uk