Can holiday lets work with current interest rates?

[Qqf]

Thinking about buying a holiday cottage in the town I’m from. I can’t/don’t want to buy to live in as I move around every few years overseas. My parents are happy to do some work on the property i e arranging suitable cleaning staff etc.

I can put down a decent deposit but will still need a mortgage of a couple of hundred thousand.

I want a property/foot on the ladder. I may move back to the town or I may decide to buy elsewhere in a decade. But I want to have a UK property as a safety net.

Can it work with the current mortgage rates?

What will your ltv be ?

Just in case you don’t know, you’ll need a 25% deposit for a buy-to-let. Also, you’ll only get tax relief on the interest; the capital repayment portion of your mortgage is profit as far as HMRC is concerned.

Eg. Your mortgage is £1500 a month;
£500 is interest and £1000 is repayment. You rent the house out for £2000 a month, so your profit as far as HMRC is £1500 a month (less allowable expenses). Assuming you are a basic rate tax payer, you’ll pay 20%/£300 tax on that £1500, meaning you’ll get £200 a month.

Hard to make it work these days. Most people I know who have one do it as a way of financing a place they want to use themselves rather than as a money maker.