Many people rent their houses out on a short term basis to Airbnb users, and a new type of mortgage is being launched to make this easier, according to an October 2017 Property118.com article.
Most residential mortgage lenders do not allow homeowners to let out their whole homes using agencies such as Airbnb. They might see owners as having a commercial contract with Airbnb and this not being covered by the terms of a standard residential mortgage.
Renting one or two rooms while the owners are still resident is acceptable under the terms of many mortgages, but lenders do not allow renting out the whole house while the owners are away, unless they are classed as a holiday home.
Many buy-to-let or commercial mortgages want owners to have tenants on long-term leases. Thanks to the increasing popularity of Airbnb, a mortgage has been launched that allows use of the online hospitality service.
The mortgage costs extra interest, but allows owners to profit from Airbnb rentals without contravening their mortgage conditions. Owners must demonstrate that they can generate enough profit from Airbnb rentals to cover 50% above the cost of the loan repayments.
The high cost of these Airbnb loans may not be suitable for people who only occasionally want to rent out their whole house, but owners who plan to generate a lot of income from renting their property may see them as a viable option.
Homeowners who want to use Airbnb to rent out their whole house should talk to an experienced mortgage broker about all their mortgage options.
