"It’s been nearly five years to the day since we launched our first holiday let product at Hodge, and a lot has happened in the holiday market in that time. "
- James Enos, national account manager for Hodge
Hodge has reinstated its five-year fixed rate holiday let products, added a new two-year fixed rate product and reduced the rate on its current two-year fixed rate product by 95 basis points.
Five-year fixed rates now start from 5.66% at 75% LTV with a £1,995 fee and 5.78% with a £995 fee. A new two-year fix has launched at 5.75% with a £1,995 fee and the existing two-year fix with a £995 fee has reduced by 0.95% to 6.05%.
Rates have also been reduced across the holiday let retention range by up to 83 basis points.
Alongside this, the specialist lender has also made criteria changes. Holiday let lending will now be restricted to non-portfolio landlords, meaning that Hodge will only accept holiday let mortgage applications from property investors who have three or less mortgaged properties excluding their primary residence.
In light of recent tax changes in the Spring Budget, stress rates on these products are also changing. Stress rates for the five-year holiday let products and pound-for-pound remortgages will increase to a maximum of pay rate +2% or 5.5%.
There is no change to the two-year stress rate and the Interest Coverage Ratio (ICR) will be reduced across the board from 145% to 140%.
James Enos, national account manager for Hodge, said: “It’s been nearly five years to the day since we launched our first holiday let product at Hodge, and a lot has happened in the holiday market in that time.
“The reintroduction of our popular two and five-year fixed products and the rate reduction on our two-year product will give investors more options.
“Despite the difficulties the holiday let market has seen in recent years, it is still a popular investment option for many. Our products also allow investors to rent their holiday lets on Airbnb and stay at their properties for up to 90 days with no minimum income requirements, increasing their popularity.”
