Demand finally turning a corner for second home mortgages as "January felt like a gear change"

ended 11. February 2026

DEMAND is finally turning a corner for second home mortgages as "January felt like a gear change", experts have revealed.

Budget uncertainty, rate volatility and ongoing regulatory chatter cooled confidence in 2025, they claim.

But they say there’s a sense that buyers are slowly re-entering the market — particularly those who sat on their hands through 2025.

Kate Allen, Owner at Kingsbridge-based Finest Stays, said that from what she's seeing in Devon, second home demand is still trailing the main residential market, but it’s noticeably picking up pace compared to 2025.

Coastal hotspots like the South Hams remain hugely desirable from a lifestyle point of view, but buyers are being more price sensitive and more mortgage dependent than they were during the post-Covid boom.

At the same time, there’s growing interest in properties that can genuinely work harder — either as higher yielding holiday lets or flexible part time main residences.

She said: “January felt like a gear change. We saw a surge in estate agents requesting rental overviews, which typically means stock is coming to market and buyers are looking closely at whether holiday let income will support lending. Holiday home buyers are still led by lifestyle and emotion, but unlike the post Covid rush, the financials now have to work.

"Our rental overviews are regularly used to help secure mortgages, which shows how central income modelling has become. We also saw a 267% jump month on month in enquiries from property owners looking to bring their homes to market as holiday lets.

"That level of uplift usually signals serious intent and confidence from owners that the holiday let model is still commercially viable, rather than just passive interest.”

Riz Malik, Director at Southend-on-Sea-based R3 Wealth, said second homes are perfect for those who can afford them.

He added: “I am currently looking at second home borrowing options for a client. By the time they weighed up moving and the associated costs, a small bolt hole on the coast became more desirable.

"Lenders are still comfortable lending in this space, and for those who can afford it and dream of having a place by the beach to relax, why not?”

There’s also a wider question about geography. Coastal will always carry emotional pull, but are we starting to see stronger mortgage driven demand returning to cities and commuter locations first, with discretionary second home purchases lagging slightly behind?

Keen to hear from brokers and lenders:

How is mortgage demand right now specifically for second homes or holiday lets?
Are you seeing stronger enquiry levels in any particular regions?
Is coastal still leading demand, or are cities and commuter belts seeing a faster recovery?
Are lenders becoming more comfortable again with holiday let income models, or still cautious?
Are buyers mostly lifestyle driven, or more yield and affordability focused than before?
Has sentiment noticeably improved since late 2025 / post budget?

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Kate AllenVerified

Owner at Finest Stays

January felt like a gear change. We saw a surge in estate agents requesting rental overviews, which typically means stock is coming to market and buyers are looking closely at whether holiday let income will support lending.

Holiday home buyers are still led by lifestyle and emotion, but unlike the post Covid rush, the financials now have to work. Our rental overviews are regularly used to help secure mortgages, which shows how central income modelling has become.

We also saw a 267% jump month on month in enquiries from property owners looking to bring their homes to market as holiday lets. That level of uplift usually signals serious intent and confidence from owners that the holiday let model is still commercially viable, rather than just passive interest.

Riz MalikVerified

Independent Financial Adviser at R3 Wealth

I am currently looking at second home borrowing options for a client. By the time they weighed up moving and the associated costs, a small bolt hole on the coast became more desirable. Lenders are still comfortable lending in this space, and for those who can afford it and dream of having a place by the beach to relax, why not?

Samuel Mather-HolgateVerified

Managing Director & IFA at Mather and Murray Financial

The housing market is a yardstick of the wider economy and no one is confident about that. The Spring budget really does need to incentivise buyers, and workers and investors or else there will be another bleak year ahead for the chancellor. With the pound weak against the euro, international investors have got a bargain in the uk at the moment, but that is a stain on Labours reputation.

Zaman Sheikh

Director at Northwood Chelmsford & WN Properties Shenfield

In shenfield and Chelmsford popular Essex commuter towns to london, I am finding the contrary. Many of my buyers are relocating out of london into Shenfield and Chelmsford seeking a lifestyle change, with foresight of starting families and more value for money with similar and better (more comfortable) commuting options into the city. Namely the Elizabeth line and greater Anglia trains. Why would cramp up on the central line when you can get a seat and wi-fi on air conditioned train that takes the same amount of time to get into london?? London has hit an affordability ceiling in my opinion, people are looking for value for money and landlords are exiting and deploying capital elsewhere. January has been a very busy month for properties coming on the market and buyer activity

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4 responses from the Newspage community
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