Holiday Let Mortgages for Expats and Non-UK Residents

Who this page is for

If you are a British expat or a non-UK resident considering a UK property to let out to holidaymakers rather than to a long-term tenant, this page is for you. That covers a British national living abroad who wants a sterling-denominated holiday let investment in a market they know well, and a foreign national buying a UK holiday property as part of a wider portfolio.

This page covers what a holiday let mortgage is, how it differs from a standard expat buy-to-let mortgage, how lenders assess the income, and what the tax position looks like since the furnished holiday lettings regime changed.

What a holiday let mortgage is

A holiday let mortgage funds a property let out short-term to holidaymakers, typically for periods of a few nights to a few weeks, through a booking platform, a letting agency, or a management company. It sits apart from a standard residential mortgage, which assumes owner-occupation, and from a standard buy-to-let mortgage, which assumes a single tenant on a longer-term tenancy.

Lenders treat holiday lets as a distinct product because the income pattern is different. Rent on a standard buy-to-let arrives as a fixed monthly figure. Income on a holiday let varies by season, occupancy, and local demand, and is usually assessed as an average or a projected figure rather than a fixed rent.

How a holiday let mortgage differs from standard buy-to-let

Three things typically differ.

Income assessment. Standard buy-to-let lending stress-tests a fixed monthly rent through an interest cover ratio (ICR). Holiday let lending works from a projected average income, usually supported by a letting agent estimate or an independent assessment, reflecting a realistic year-round figure rather than peak-season pricing.

Lender pool. Fewer lenders offer holiday let mortgages than standard buy-to-let mortgages. Within that smaller pool, fewer still accept non-resident applicants, so the available choice for an expat or foreign national buyer narrows further.

Personal use. Many lenders allow the owner some personal use of the property, but expect it to be genuinely available for holiday letting for most of the year. Policies on exactly how much personal use is acceptable vary by lender.

Expat and non-resident considerations

Applying for a holiday let mortgage while living abroad adds the same broad considerations as any other expat or non-resident UK mortgage: currency of income, proof of overseas residency, and a deposit sourced and documented to the standard UK lenders expect.

The narrower part is lender choice. A holiday let product and a non-resident acceptance policy do not always sit at the same lender, so working out which lenders combine both appetites is the main practical hurdle. This is squarely specialist broker territory rather than something to work through directly with a single high-street lender.

Property location also matters more here than on a standard buy-to-let. Lenders and letting agents both favour established holiday letting markets with a track record of demand, which supports a more reliable income projection than an unproven location.

The tax position has changed

Furnished holiday lets previously benefited from a distinct tax regime that treated them more favourably than standard rental property, including how mortgage interest and certain costs were relieved against tax. That regime was withdrawn from April 2025. Furnished holiday lets are now broadly taxed in line with other rental property.

This is a meaningful change from how holiday lets were commonly understood to be taxed, and it affects the net return a holiday let can be expected to generate. If you live outside the UK, you will also need to consider the Non-Resident Landlord Scheme, which applies to UK rental income of any kind received while living abroad. Speak to an accountant familiar with current rules before committing to a holiday let purchase, since the tax position is a material part of the investment case.

Serviced accommodation: a related niche

Serviced accommodation is a related but distinct category: a property let short-term on a more business-like basis, often through a management company, sometimes year-round rather than seasonally, and sometimes targeted at business travellers and relocating professionals rather than holidaymakers.

Some lenders that offer holiday let mortgages also consider serviced accommodation, and some do not. It is a smaller and more specialist corner of the same broader short-let market. If you are weighing holiday letting against a serviced accommodation model, raise both with your broker at the outset, since the lender shortlist can differ between the two.

Common situations

The British expat buying a first holiday let. A UK national living abroad wanting a sterling-denominated holiday letting investment in a market they already know, often a coastal or rural area they visit or have a family connection to.

The existing landlord diversifying. An expat or non-resident with an established standard buy-to-let portfolio adding a holiday let for yield diversification, having weighed the higher management involvement against the return.

The foreign national building a UK portfolio. An overseas-based investor adding a holiday let alongside standard buy-to-let property as part of a broader UK investment spread.

The former main residence converted to a holiday let. An owner who has moved abroad and, rather than a standard consent to let or buy-to-let remortgage, wants to let the property short-term instead. This needs a specific holiday let product and lender sign-off, not just standard consent to let.

Frequently asked questions