Airbnb, Serviced Accommodation and Your Buy to Let Mortgage: A Note for South East Landlords

7 September 2026

Guests spent just over 100.9 million nights in UK short term lets during 2025 — up 11.5% on the year before, according to the Office for National Statistics. Here in the South East, our own growth was gentler than that, just 5.8%, and Brighton and Hove actually saw guest nights dip slightly last year. But slower growth doesn't mean small numbers. Walk along the seafront in Brighton, Hastings or Whitstable on a Friday evening, or through the lanes of Rye on a summer weekend, and you'll see plenty of where those nights are being spent.

Here's the bit that keeps me on the phone more than almost anything else. A good number of those beds sit inside a property funded by a buy to let mortgage that was written for something else entirely.

It's rarely deliberate. It's usually a landlord in Tunbridge Wells or Eastbourne who bought a flat, took out a standard buy to let mortgage, tried a long tenancy, worked out the numbers looked better on Airbnb, and switched. Nobody sat them down and explained that the mortgage offer they signed said something quite specific about who's allowed to sleep there.

What your mortgage actually says

Almost every mainstream buy to let mortgage in this country is written on the same assumption: the property will be let to a tenant on an Assured Shorthold Tenancy, usually six or twelve months, with that tenant having exclusive use of the place. One rent, one tenant, one set of rules if things go wrong.

Most lenders go further still. They'll set a minimum term, commonly six months, and rule out holiday lets and serviced accommodation outright. Some rule out company lets too, or lettings to anyone connected to you. It's all sitting in the mortgage conditions, usually under a heading like "Letting the Property," running to about a page and a half.

Honestly, almost nobody reads it. I've watched a lot of clients sign a lot of paperwork over the years, and I'd say two in a hundred have gone through their mortgage conditions properly. That's fair enough — they're not written to be read for pleasure, and most people have better things to do of an evening.

But a guest booking three nights through a platform isn't a tenant on an Assured Shorthold Tenancy. In law, they're an occupier on a licence — a completely different arrangement. And that difference is the whole problem.

Why lenders care who's staying

This isn't the lender being sniffy about Airbnb — plenty of them use it themselves when they travel. They price and secure the loan on the basis of what they were told at the outset. It's not judgement, it's simply the right item in the right box.

Reading a lender's appetite is a bit like reading the ice before you skate on it. You don't just step out because it looks solid — you check the edges, you know where it's thinner, and you know conditions change from one week to the next. A lender who was told "long-term tenant" and finds "rolling guests" is stepping onto ice they didn't check.

There are three real reasons this matters to them:

• Getting the property back, if it comes to that. A tenant on an AST is a known process. A changing cast of short-stay guests, sometimes with a management company in between, is not — and lenders have had to untangle bookings taken months in advance, with guests turning up to find no property and nobody quite sure who owes them a refund.
• The valuation. A surveyor values a flat differently depending on whether it's a tenanted residential investment or a fitted-out serviced apartment, and the pool of buyers in a forced sale can look very different too. We've written before about why the basis of a valuation matters more than the headline figure.
• Insurance. A standard landlord buildings policy generally doesn't cover paying guests. If the lender's security isn't properly insured, that's their problem — and, as I'll come back to, very much yours as well.

Lenders are checking far more than they used to

For years this was a rule that existed on paper and rarely got enforced. That's changed, and largely for reasons that have nothing to do with mortgage lending at all.

Since January 2025, platforms including Airbnb and Booking.com have had to report host details to HMRC each year, including the address of the property listed. That information exists now, in a way it simply didn't before.

In Scotland, every short term let has needed a licence since 2023, and the registers are public. In England, a national registration scheme and a new planning use class for short term lets have been working their way through, and in Greater London, letting a home as short-stay accommodation for more than 90 nights a year has needed planning permission since 2015 — with boroughs getting noticeably better at spotting it.

Closer to home, Brighton and Hove now charges a 100% council tax premium on furnished second homes and short lets that don't meet the business-rates test (available to let at least 140 nights a year, actually let for 70), adding well over £1,700 a year to the bill on some properties from April 2025. Other South East coastal and market towns are watching that policy closely.

Add in the mundane checks — a buildings insurance schedule that says "holiday let," an underwriter who recognises a distinctive kitchen from a listing photo, someone actually reading the file at remortgage — and the idea that your lender simply won't find out doesn't hold up any more.

What actually happens if you're in breach

It's rarely a repossession letter on day one. What usually happens is smaller, and more expensive.

Consent gets refused. The rate gets loaded. The product transfer you were relying on gets declined and you're moved onto the standard variable rate while you scramble for a new deal. Occasionally the facility gets called in, with a notice period that's no comfort at all when you need a specialist lender and a valuation inside a month — and any bookings you'd already taken may need refunding.

The part that genuinely worries me is the insurance. A landlord policy voided because paying guests were in residence doesn't just cost you a premium — it costs you the claim. A burst pipe in a top-floor flat, with a guest inside and a neighbour's ceiling coming down, becomes a five-figure problem that's entirely yours to carry.

And if you're a leaseholder, do check your lease as well as your mortgage. Many South East leasehold flats — especially the seafront conversions — prohibit lettings under six months, or need the freeholder's consent. Breaching both at once is a genuinely bad afternoon.

Getting the borrowing right from the start

None of this is an argument against short term lets — it's a growing, perfectly respectable part of the market, particularly along our coastline. It's an argument against funding a short-let business with a mortgage designed for a twelve-month tenancy.

The right lending exists, it's just a narrower shelf. On our panel there are fewer than fifteen lenders with genuine short-let or serviced accommodation criteria. Deposits typically start at 25%, often nearer 30–35% for full serviced accommodation, and rates usually sit half a point to a point and a half above an equivalent buy to let mortgage — though that gap has been narrowing.

What decides most of these cases isn't really the property. It's how the income is presented. Lenders want twelve months of genuine booking data, averaged across the year, not a screenshot of a brilliant August bank holiday weekend. Some will stress the case against the equivalent AST rent instead, which sounds harsh, but gives them a fallback if they ever had to take the property over — get that wrong and a perfectly good case gets declined for the wrong reason.

This is also why it matters who you tell, and when. We sit separately from the lender, your accountant and the taxman. If a client tells me their flat by the seafront has quietly been on Airbnb for eighteen months and it never came up before, that's not a problem for me — it's simply information I need to place things properly. I'd always rather hear it in the first conversation than have an underwriter find it in month two. Tell us everything, and we'll work out the best route through it together.

What to do this week

If you've a South East property let short term on a standard buy to let mortgage, four things worth doing now:

1. Dig out your mortgage conditions and find the letting clause.
2. Check your buildings insurance actually names short term or holiday letting.
3. If it's leasehold, check for a minimum letting term in the lease.
4. Find out when your current mortgage product ends — that's your natural window to move onto the right facility without an early repayment charge.

Then have the conversation before you need to. Sorting this at the point your product expires is straightforward. Sorting it after a lender has already written to you is a good deal harder, and usually a good deal more expensive.

I've seen enough people caught out by a clause in their buy to let mortgage they never knew was there. It's rarely the return on these deals that causes the trouble — it's the paperwork sitting quietly underneath them.

If any of this sounds close to your situation, I'm always happy to have that conversation.

Elena Leach Lime Finance Solutions

A few quick questions I get asked a lot

Can I use my buy to let mortgage for Airbnb if it's only occasional? Usually not — most conditions set a minimum tenancy of six months, which rules out short stays regardless of how often you do it. A handful of lenders allow limited short-letting with written consent, but that consent isn't always easy to get. When in doubt, ask us rather than assume.

Will my lender really find out? More easily than they used to, certainly. Platforms have been reporting host and property details to HMRC since January 2025, licensing registers are public in Scotland, and insurance schedules and public listings tend to do the rest.

Do I need a limited company to run a short let in the South East? Not always, but it's become the usual route for new purchases, largely for tax reasons since the Furnished Holiday Lettings regime ended in April 2025. Worth a word with your accountant before you apply, not after.

Can I switch mortgages without an early repayment charge? Sometimes, if the lender agrees to vary the existing facility rather than needing a full remortgage — though there's no guarantee, and there can be a cost. The safer plan is to time the switch for the end of your current fixed rate, and start the conversation around six months out so you keep your options open. If you'd like a wider sense of where rates and lender appetite currently stand, our latest mortgage news update is worth a read too.