Mortgage for an Airbnb

[Pumperthepumper]

We’re looking at buying a property in Scotland to then run as an Airbnb, or a holiday lease. How easy is it to get a mortgage for that kind of thing? Are we better just getting a traditional buy-to-let? Really grateful for any advice.

Do you already own another home?

With or without a mortgage?

Yes, we already have a house and a half-paid off mortgage.

Yes, we already have a house and a half-paid off mortgage.

Remortgage that then and buy in cash.

We did think of that, and it’s another possibility. I was wondering how difficult it is to get a second, buy-to-holiday-let type mortgage, or if it’s even possible.

or just don't. Airbnb is ripping the guts out of Scotland.

Without a large deposit and a permanent income which covers the mortgage repayments it’s very difficult, because you have no guarantee of rental income on a holiday let. Or, you need to have an established rental income on the property of around 200% coverage, so to be buying an already very successful holiday let.

Can't help with mortgage advice but are you intending to service the place yourself?
Any property with a constant turnover of tenants is hugely demanding on your time if doing it yourself and very expensive if you use an agency. Wear and tear can be catastrophic and many Scottish councils are cracking down on air bnb properties.

You need a proper holiday let mortgage. A buy to let isn't the correct one- you would be breaking the terms to do short term rental.

Look at Principality, Cumberland and Leeds. You can also contact a specialist broker.

Mine is with Principality. The interest rates are very similar to buy to let.

You would probably need a buy to let based on long term rental.

Holiday lets are vulnerable- Air b n b even more so- it could end tomorrow and then you would have no income. Plus some councils are considering business rates for airbnb

Also bear in mind you have to pay extra stamp duty on a second home, 3% above the regular rates payable for 1st homes.

Also bear in mind you have to pay extra stamp duty on a second home, 3% above the regular rates payable for 1st homes.

4% in Scotland

We have the deposit and income, I like the flexibility of running a holiday let, but agree that the stability of permanent tenants makes it a lot easier. But I’d like to know how to go about getting a buy-to-lease mortgage for a holiday property, if anyone has any experience.

That’s great Moving thank you!

I have 2 air bnb properties in Scotland
I went via a mortgage broker and I’m with bm solutions For both mortgages
Needed a 20-25% deposit for each property and then they wanted to know approx how much rental value was
They also wanted to know all of my current outgoings so that they knew I could pay the mortgage should property not be rented out at any time
Hope this helps

For God's sake, people post about things they know nothing about.

Buy to Let mortgages cannot be used for holiday let purposes.

Short term rentals are all liable for business rates. However, you can claim small business rate relief.

The tax situation is different for a holiday let. You can offset more expenses as it is considered ( and is) a business.

As long as you choose your location carefully there is no earthly reason why a holiday property wont make money. There are thousands of self catering holiday cottages throughout the uk.

Thanks Christmas and Moving. To be fair, my opening post was worded badly - we’re trying to decide if we’re going to buy somewhere to rent out OR buy somewhere to use as a holiday let, ie permanent tenants or holiday tenants. I knew it was different mortgages for each, we’re trying to decide which would work better for us. I like the idea of a holiday let as it’s much more flexible. Good to know about the tax situation!