A staycation property investment boom is on the cards as buyers look to take advantage of hordes of Brits opting to holiday in the UK.
Queries from investors wanting to buy holiday lets are already up 25% since the Chancellor announced the stamp duty holiday last week, according to cottages.com research, and new products are being launched by lenders to capitalise on demand.
This week, YBS Commercial Mortgages reported that staycations are soaring in popularity and announced a new mortgage deal for holiday lets aimed at limited company borrowers.
The Ipswich Building Society (IBS) even had to temporarily pull its holiday let market product earlier this month after it was swamped by demand.
Chief executive Richard Norrington tells LandlordZONE that it hopes to reinstate it as soon as it’s cleared the backlog of current applications.
“We, and many other lenders have been overwhelmed with holiday let enquiries and so we know there is clearly a huge demand for holiday let mortgages as Brits abandon their plans for overseas holidays and look for alternative options in the UK,” he explains.
The number of holiday let mortgage products currently available is down from 162 to 60 while the number of providers has fallen from 20 to nine since 5th March, according to data firm Moneyfacts.
In June, there were 34 buy-to-let mortgages launched that accepted holiday lets, of these, 28 mortgages were specifically for holiday let mortgages.
Moneyfacts finance expert Eleanor Williams reports that despite this reduction, the buy-to-let market seems to be moving slowly towards recovery.
She tells LandlordZONE: “We hope we will soon see more options for would-be investors to consider. Indeed, in a boost to this sector of the market, today has seen Leeds Building Society relaunch their two-year fixed range of holiday let products.”