Industry Insight Episode 08 | In 2020, the UK saw an unexpected rise in demand for staycations. Travel restrictions, quarantine concerns, and global uncertainty shifted holidaymakers’ focus to local destinations. As international travel paused, homeowners and investors turned to UK holiday lets as a reliable source of income. This shift reshaped the holiday mortgage market, creating new opportunities for property owners, advisers, and specialist lenders. In this episode, we explore how the staycation trend shaped buying behaviour, rental demand, and mortgage solutions during a defining year.
Missed the earlier episodes?
Catch up with:
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Episode 1: Multigenerational Living Is On the Rise
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Episode 2: Challenges in the Mortgage Industry
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Episode 3: Turning Annexes into Holiday Lets
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Episode 4: Making the Dream Achievable
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Episode 5: Homeworking and Housing Demand
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Episode 6: New Housing Trends Post COVID
- Episode 7: A High Street Demise Outlook
The Return of the UK Staycation
Episode 8 focuses on the staycation trend of 2020. UK travel restrictions and global uncertainty drove more people to book domestic holidays.
Holidaymakers avoided overseas travel due to quarantine rules and health concerns. This led to a boom in UK holiday lets.
Demand Creates Opportunity
Staycations boosted demand for local rentals. Homeowners began listing properties to capitalise on the growing trend.
Holiday let mortgages became more flexible. Lenders offered tailored products to support property owners.
Small towns and rural spots saw a rise in tourism. Local businesses gained from this shift in holiday behaviour.
Property Price Pressure
High demand affected property prices. First-time buyers found it harder to enter the market. Supply of suitable homes dropped in popular locations.
The rise in holiday lets highlighted the varied quality of properties. Customer satisfaction often depended on upkeep and amenities.
Booking Levels in 2020
At Harpenden Building Society, we saw more holiday let enquiries.
Data from Hoseasons showed summer bookings up 67%.
Cottages.com reported a 50% increase in bookings.
Despite restrictions, demand for UK rentals remained strong.
Buyer Aspirations Rise
A Property Wire survey revealed 77% of UK adults wanted a second home.
Buyers from cities like London and Manchester sought space and income.
Even after lockdown, access to outdoor areas remained a top priority.
See more on trends like this in our New Housing Options Post-COVID feature.
Availability Shrinks
Traveller Huw Williams shared his story. He searched for UK holidays early in the year. Most destinations were already 90% booked.
He found few family-friendly homes left. Large homes with kitchens were in short supply.
This demand spike led owners to invest in letting properties.
Holiday Lets Bring Profit
Entrepreneur Dan Collins expanded his portfolio.
He turned a North Norfolk home into a holiday let. Photos and listings followed quickly.
He expected full bookings for the summer. The staycation trend supported his success.
Collins planned further investments with holiday let finance. Owners saw letting as a strong business move.
The Role of Specialist Lenders
New landlords faced financial challenges.
Specialist mortgage networks helped match borrowers with suitable lenders.
These lenders reviewed full financial profiles. Unlike high-street banks, they did not rely solely on automated decisions.
Manual Underwriting Advantage
Harpenden used manual underwriting.
This approach gave a full view of an applicant’s finances.
We reviewed income, rental forecasts, and personal circumstances.
Our goal was to approve strong cases that mainstream banks might reject.
Financial Safeguards
We required borrowers to show surplus funds.
This ensured payments could continue during guest-free periods.
For example, clients needed reserves to cover three months of costs.
This protected both client and lender in uncertain times.
Minimum Income Criteria
Lenders had different rules.
Harpenden required a minimum annual income of £30,000.
Holiday let income and personal earnings were both considered.
We supported brokers looking to grow in this niche.
Opportunity in UK Holiday Lets
2020 created a strong staycation market.
UK holiday homes grew in demand.
Buyers turned to mortgage networks to finance holiday let investments.
With the right lender and support, landlords saw steady returns.
Our role is to support borrowers as they navigate these opportunities with personalised underwriting, market insights, and agile solutions. At Connect, we believe mortgage advisers have a vital role in shaping this next chapter of the housing market.
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