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What's the difference between a Short Term Let, Airbnb, Holiday let and Serviced Accommodation?

28 Mar 2024

Here is our guide to cutting through the terminology to ensure you are recommending the correct product for your client.

Airbnb Article

Short Term Let

Short Term Lets provide landlords with flexibility, allowing them to let out their properties on a short-term basis, without the need for an Assured Shorthold Tenancy Agreement.

These can be standard short term lets where the property is occupied by travelling business people or those in need of a temporary home. Alternatively, they can be holiday lets where the property is occupied by holiday-makers for a short period.

The property will be valued and the rental coverage will be assessed on the same basis as a standard buy to let (BTL) using a monthly rental figure to calculate affordability.

Short term lets are acceptable subject to criteria on our Short Term Let product range.


Holiday Lets

Holiday Lets are properties that are let out taking advantage of the fluctuating seasonal income that can be achieved for this type of property.

Typically, Holiday Lets can achieve more income over a 12-month period than they would if they were let out on a normal AST.  During peak holiday season, depending on the location of the property they can command much higher income than they would if the property was let out as a standard BTL during those times. 

Being able to take an average of the seasonal income often increases the borrowing power of the applicant.

We have specific products for Holiday Lets and they are also available across our Multi Property One Title product range.


Serviced Accommodation

Serviced Accommodation is not an area where FHL are able to lend currently.

Serviced accommodation units are often flats/apartments and are usually identifiable from property advertisements. They often have concierge and housekeeping services and shared leisure and wellbeing equipment such as pools, gym and spa facilities within the block so have more of a hotel feel about them. Sometimes the company selling the Serviced Accommodation property may offer guaranteed rent schemes (which we never accept on any of our BTL properties)


Short Term Lets & Holiday Lets Do’s and Don’ts

  • Short Term Let properties must appeal to both BTL investors and residential owner occupiers and this will be verified by our valuers.
  • Air BnB can be considered on both when let out as a whole property (not as individual rooms to multiple parties at one time).
  • Short term lets don’t require an AST – and can be let for a maximum of six months or as little as one day.
  • Properties subject to onerous title restrictions will not be considered for Short Term Lets – for example: restrictions on the title deeds which don’t permit ASTs of 12 months or more, or restrictions stating that the property cannot be used as a short term let or holiday let, or that a property can only be used as a private residence.  For Holiday Lets there may be some flexibility depending on the restriction so please speak to us about this.
  • The property must not be used for personal use by the customer or by a member of the customers family.
  • For both Short Term Lets and Holiday Lets we have specific products within our Solutions range where the property is a MUFB with up to 4 units or where there are up to 4 individual properties on the one freehold title.


Hopefully this will help you select the most appropriate product for your client but as always please get in touch to chat though any cases you need help with.


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