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  • Deal Finding

    Bournemouth holiday let - deal or no deal?

    Hi All

    I thought I would run this past like minded people I have negotiated down a large 4 bed house in Bournemouth ( holiday let’s £2000 per week ) for £655k yes a lot of money and deposit and stamp duty which basically wipes out my cash reserve

    Our good old friends on the survey have down valued the rental from £3000pm to £1900 pm which throws the deal out with Kensington (20% deposit) on experience it’s not worth the hassle to change their mind

    Great house that will always go up in value but do I basically want to go into borrowing to get this deal done in uncertain times on an ast it will achieve £3000 pm and on holiday let’s £100k but I will lose 17% to have it managed which is money well spent I think

    What are your thoughts walk away or push to get the deal done which will cost more

    alan paul
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    Hi Alan,

    It sounds like the valuation was for single occupancy on an AST?  You need a holiday let mortgage product for this.

    On the single occupancy rent, a rent of £1900 per month will support a borrowing of circa £285K using the standard PRA deal stacking calculation.  Even if you had got the valuation at £3K per month, it would only have supported a borrowing of circa £450K.

    Therefore, in my mind, it does not stack up financially on a single occupancy basis.

    Have you considered trying specialist holiday let lenders as this is the correct product you should be using?  There are a few more in the market place now.

    Sorry if I have misunderstood something .... 

    I would also use my offer template letter to get a further price reduction.  Yours might be the best offer they get!

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    Alan, firstly, I concur ... trying to achieve a successful appeal is very hard, especially with Kensington.  Recently going through one now with them, not easy!

    Vanessa is spot on - a holiday let mortgage (different from a BTL mortgage) may very well be the answer.

    Also, looking at the specialist lenders as well as the other high street lenders should be explored as well.

    We can provide you with access to all these lenders and products.

    It all starts with a full Fact Find discussion - to start this process, send us your contact details and an overview of the situation to advice@ptfs.co.uk


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    Hi Pauls,

    I am currently going through the same process. Spent weeks going through the process with Leeds having initially been told they used holiday rental figures as opposed AST (this was my very first question ) and then later to be told I was misinformed ?.

    Echo the previous comments re the correct product - in holiday let specific market the most competitive rates I have come across that allow you to use the rental income of holiday lettings is Furness for a 2 year fix @ 3.99% or a variable with Mansfield at 3.65%.Obvs my circumstances will be different so these we’re the only ones I will be eligible for - there may be others that are better but the market is still reasonably small. 

    I’m not sure the ltv you are intending to go for but I know that a lot of the products I saw had a cap on max amount to borrow of £500k .

    All the best 

    Chris
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