Bridging finance for holiday lets

Why speed is redefining holiday-let funding in 2025

Holiday-let investors are competing in a market where the best properties rarely linger. Bridging finance has become a practical solution for buyers who need to move quickly, whether to secure a coastal cottage before peak season or to complete essential renovations during a narrow off-season window. Recent market data shows gross bridging lending rising to over £209 million in a single quarter, with completion times averaging around 38 to 43 days. For time-sensitive purchases and refurbs, that lead time can be the difference between catching the summer bookings wave or missing it entirely.

Pricing has also shifted in investors’ favour. Average monthly bridging rates moved lower through early 2025 while application volumes increased, signalling a competitive market for qualified borrowers. At the same time, the UK bridging loan book is on course to exceed £10 to £12 billion, bringing more lenders, broader product choice and a healthier appetite for specialist cases such as uninhabitable properties, conversions and projects needing higher loan-to-value ratios. For holiday-let buyers, that means more options to match the property and the plan.

The purpose of bridging is evolving too. While sale remains the most common exit, bridge-to-let remortgaging is an established path, especially for investors refurbishing to reach target occupancy and Average Daily Rate benchmarks before locking into a longer-term holiday-let or buy-to-let mortgage. Importantly, the regulated versus unregulated distinction still matters. Many holiday-let projects sit in the unregulated space, but mixed-use or any owner-occupation elements can alter the product you need. Getting it right at the outset avoids costly delays later.

Understanding APR is not just about percentages - it is about what you will pay in real terms over the months you hold the bridge.

Speed is not the only story. Higher permitted LTVs, specialist underwriting and lender familiarity with regional hotspots like the Lake District and the Cotswolds mean investors can often borrow against properties that mainstream mortgages would decline until works are complete. Those regional markets also continue to post attractive annual incomes, helping underpin the case for short-term funding before a refinance or sale.

In short, the market’s direction of travel is clear: faster processes, sharper pricing and more specialist capacity. Used well, bridging lets you capture seasonal opportunity without compromising your exit plan.

Who benefits most from this approach

If you are targeting a holiday-let purchase that requires swift exchange, or a property needing light-to-moderate works before it can be marketed, bridging can provide the pace traditional mortgages struggle to match. Investors seeking to acquire at auction, buyers facing a chain complication, or those preparing a property for sale with a value uplift are typical candidates.

It also suits experienced landlords executing a bridge-to-let strategy, including expats and non-standard income borrowers who may benefit from specialist underwriting. If you want to time completion and refurb between seasons to maximise first-year revenue, a short-term bridge can align finance with your operational deadline. If owner occupation is involved, regulated bridging may be required, and professional guidance becomes essential.

Smart routes to fund and exit

1. Purchase bridge only - buy quickly, then sell on completion of light works.

2. Purchase plus refurb bridge - fund acquisition and works, then refinance to a holiday-let or buy-to-let mortgage.

3. Auction bridge - 100 percent of purchase within auction timelines, repay via sale or refinance.

4. Refinance bridge - release equity from an existing asset to fund another holiday-let purchase.

5. Development-style bridge - for heavier works where lenders lend in tranches against build stages.

What it really costs and why it matters

Shorter completion times - often around six weeks - can reduce holding costs and help you catch the key booking season. However, interest is generally charged monthly and may be retained or rolled up, so model different durations and stress test for delays. Market competitiveness can improve pricing, but lender criteria still vary by region, property type and borrower profile.

Who typically qualifies and what lenders look for

Eligibility hinges on a clear exit and a property that a valuer can price with confidence. Lenders usually assess your experience as a landlord or renovator, though first-time investors can be considered where the plan is credible and supported by professional advisers. Expect to provide evidence of income or assets, details of works, planning or building control requirements if relevant, and a realistic timeline that allows for seasonal access and contractor availability.

For holiday lets, lenders pay close attention to location, local regulation and achievable income. Hotspots like the Lake District, Cotswolds and popular coastal towns are well understood, but conservation areas or National Parks can add complexity. Higher LTVs are available with some specialist lenders for properties needing refurbishment, including those initially not mortgageable. If there is any chance of owner occupation, regulated bridging rules apply. As a UK-based broker, Kandoo can help position your case to the right lender, ensuring compliance is clear from the outset and that timescales align with your intended exit.

From application to keys - the practical steps

1. Define purchase, works and exit in a concise plan.

2. Share documents early - ID, proof of funds, experience.

3. Instruct valuation and legal teams at the same time.

4. Agree rate, fees, term, LTV and interest method.

5. Finalise refurb scope, quotes and timeline contingencies.

6. Complete legals, sign documents, draw down funds.

7. Execute works, monitor costs, report progress if required.

8. Trigger exit - list for sale or start refinance.

The trade-offs you should weigh up

Before you commit, pressure test the plan

Bridging works when timelines are realistic and the exit is credible. Build a buffer for legal queries, valuation lead times, material delays and seasonal contractor bottlenecks. Where planning permission or building control is required, allow for local authority timeframes that can vary across England, Scotland and Wales. Model different interest durations and sensitivity-test income assumptions, especially if you plan to refinance onto a holiday-let mortgage that relies on projected occupancy and nightly rates.

Consider regional regulations on short-term lets and any licensing or council rules that could affect occupancy or restrict change of use. Keep an eye on Bank of England base-rate guidance. If rates ease, pricing could improve; if inflation surprises on the upside, costs may move the other way. Document your refinance route early with a broker and, where possible, obtain a decision in principle for the intended exit product.

Alternatives if bridging is not the right fit

1. Holiday-let mortgage with delayed completion - slower but cheaper ongoing cost.

2. Second charge on existing property - raise funds without remortgaging.

3. Joint venture equity - share costs and returns with a partner.

4. Development finance - for heavier structural works with staged drawdowns.

5. Personal or business loan - suitable for smaller, quick-turn refurb budgets.

Frequently asked questions

Q: How quickly can a holiday-let bridge complete in the UK? A: Many cases complete in roughly six weeks, with some faster. The critical drivers are valuation scheduling, legal readiness and clear evidence for the exit.

Q: What monthly rate should I expect? A: Competitive cases have seen monthly rates around the mid 0.6% to 0.8% range, though pricing depends on LTV, property type, condition and borrower profile.

Q: Is bridge-to-let a realistic exit? A: Yes. It is a common route once refurb works are complete and income projections are validated. Lenders will assess location, expected occupancy and management approach.

Q: Can I use bridging for an uninhabitable property? A: Often yes. Specialist lenders will consider properties needing works that mainstream mortgages decline, provided there is a clear programme and exit strategy.

Q: Will the loan be regulated? A: If there is any element of owner occupation, regulated bridging may apply. Pure investment holiday lets typically fall under unregulated bridging, but advice is essential.

Q: What LTV can I get? A: Up to around 75 percent is available with some lenders, subject to valuation, experience and the specifics of the works and location.

How Kandoo can help you move first

Kandoo is a UK-based broker with access to specialist lenders across the market. We match your holiday-let strategy to suitable products, from purchase-only bridges to purchase-plus-refurb and bridge-to-let exits. We coordinate valuation and legal partners who can move at pace, help you structure realistic timelines, and keep compliance clear around regulated versus unregulated needs. Speak to us early to maximise lender choice and keep your completion on schedule.

Next step: Ask Kandoo for a tailored illustration with pricing, fees and timelines based on your property and exit route.

Important information you should read

This content is for information only and is not advice. Bridging loans are secured on property and your asset may be at risk if you do not keep up repayments. Product availability, pricing and criteria change frequently. Always seek professional advice tailored to your circumstances.