Holiday let mortgages: how they differ from buy-to-let, and what they cost

In England, buy-to-let tenancy language changed on 1 May 2026: new Housing Act 1988 tenancies are assured periodic tenancies, not assured shorthold tenancies. Holiday let mortgages are UK-wide lender products, but some purchase-tax costs differ by nation.

What is a holiday let mortgage, and how does it differ from buy-to-let?

A holiday let mortgage is a specialist mortgage for a property let to short-stay guests, while a buy-to-let mortgage is for a property let as a home to tenants, and in England that now means an assured periodic tenancy rather than an assured shorthold tenancy. “Holiday let mortgage” is not a statutory mortgage category: the Mortgage Credit Directive Order defines “buy-to-let mortgage contract” but not a separate holiday-let class, and a broker summary describes the market product as “a specialist business loan secured against a residential property let on short-term tourist contracts, not on an assured periodic tenancy (APT).” The legal change matters because pages still describing ordinary buy-to-let as “AST” letting are stale for England: SI 2026/421 says the 2025 Act abolished “fixed term and shorthold assured tenancies” so that Housing Act 1988 tenancies are now assured periodic tenancies. Scotland, Wales and Northern Ireland use separate tenancy systems, so the practical mortgage distinction is still short-stay guest use versus longer residential occupation.

What rates and deposit does a holiday let mortgage need?

A holiday let mortgage typically needs at least a 25% deposit because most lenders cap lending at 75% loan-to-value, and published fixed rates in the researched market ranged from 4.78% to 6.44% depending on lender, date and fee. There is no statutory minimum deposit or statutory interest rate for a holiday let mortgage; the usable figures are lender underwriting and product pricing. The sharpest sourced market floor is: “Most lenders cap holiday let mortgages at 75% LTV, meaning a 25% deposit floor.” For rates, one 2026 market note said Cumberland’s 2-year and 5-year fixed holiday-let products were 4.78%, while Vernon Building Society’s own page listed “(H046) 6.44% fixed to 31.10.2028 Holiday Let” at 75% LTV with a £999 fee. Purchase tax is separate from the mortgage: in England and Northern Ireland, SDLT adds 5% for additional dwellings; in Scotland, LBTT’s Additional Dwelling Supplement is 8%. Wales was not covered by the sourced tax figures here.

Which lenders will lend on an Airbnb or holiday let?

The sourced holiday-let lender pool is mainly specialist building societies: Cumberland, Leeds Building Society, Hodge, Principality, Vernon, Furness, Bath, Cambridge & Counties, Suffolk and Mansfield. That list comes from a 2026 holiday-let mortgage market guide naming “Cumberland, Leeds Building Society, Hodge, Principality, Vernon, Furness, Bath, Cambridge & Counties, Suffolk, Mansfield.” An Airbnb mortgage search often starts with a high-street bank name such as “NatWest Airbnb mortgage”, but the safer rule is product permission, not brand recognition: a standard residential mortgage is not the right product for short letting unless the lender has given consent. The sourced broker line is blunt: “No. A residential mortgage is FCA-regulated consumer lending and short-letting without consent breaches the mortgage terms.” For an Airbnb or furnished holiday let, ask for a holiday-let mortgage or explicit short-let consent, and compare lenders on LTV, personal-use limits, income assessment and fees.

Last reviewed August 2026.

Sources

• Mortgage Credit Directive Order 2015, SI 2015/910, art.4 — ““buy-to-let mortgage contract” means a contract that Source
• Mortgage Credit Directive Order 2015, SI 2015/910, art.4 — “consumer buy-to-let mortgage contract” means a buy-to-let mortgage contract which is not entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower” Source
• Renters’ Rights Act 2025 commencement, SI 2026/421 — “Chapter 1 of Part 1 of the 2025 Act makes various changes to the Housing Act 1988 (c. 50)(“the 1988 Act”), including the abolition of fixed term and shorthold assured tenancies, so that all tenancies under that Act will now be assured periodic tenancies, and the abolition of “section 21 evictions” (also known as “no fault evictions”).” Source
• Landlord Resource, Holiday Let Mortgage Explained — “A holiday let mortgage is a specialist business loan secured against a residential property let on short-term tourist contracts, not on an assured periodic tenancy (APT).” Source
• Landlord Resource, Holiday Let Mortgage Explained — “Most lenders cap holiday let mortgages at 75% LTV, meaning a 25% deposit floor.” Source
• Landlord Resource, Holiday Let Mortgage Explained — “Cumberland cut its core holiday let range by 0.20% from 2 December 2025, taking the 2-year and 5-year fixed products to 4.78%.” Source
• Vernon Building Society, Holiday Let Mortgages — “(H046) 6.44% fixed to 31.10.2028 Holiday Let” Source
• GOV.UK, Stamp Duty Land Tax rates from 31 October 2024 — “From 31 October 2024, an additional 5% will apply on top of Stamp Duty Land Tax residential rates if buying a new residential property means you’ll own more than one.” Source
• Revenue Scotland, LBTT Additional Dwelling Supplement — “For transactions on or after 5 December 2024 the ADS is 8% of the purchase price.” Source
• Landlord Resource, Holiday Let Mortgage Explained — “Cumberland, Leeds Building Society, Hodge, Principality, Vernon, Furness, Bath, Cambridge & Counties, Suffolk, Mansfield.” Source
• Landlord Resource, Holiday Let Mortgage Explained — “No. A residential mortgage is FCA-regulated consumer lending and short-letting without consent breaches the mortgage terms.” Source