Holiday park and caravan park mortgages

How do lenders value a holiday park for a mortgage?

Lenders value a holiday park as a going concern, not as bricks and mortar. The starting point is sustainable EBITDA, the earnings the park reliably produces before interest, tax, depreciation and amortisation, with adjustments for any owner perks, one-off items and the cost of a manager if the seller has been running it hands-on. A capitalisation rate, often called a yield, is applied to that earnings figure to produce a commercial value. The valuer also tests the asset value of the land and the holiday-home stock, and considers what a willing operator would pay to step in. Where a park has a strong owner-occupier statics base and a healthy holiday-home sales pipeline, the income tends to be steadier and the valuation stronger.

Several factors push value up or down. A long or evergreen caravan-site licence, freehold tenure, a balanced pitch mix and a record of growing pitch fees all support value. A short leasehold, a restrictive or seasonal licence, planning constraints, flood-zone exposure or an over-reliance on a single income line will reduce it. We help you understand how a lender's valuer is likely to read the park before you commit, so the offer you receive reflects realistic figures rather than an asking price built on optimistic assumptions. For context on the sector's scale, the UK has around 6,200 holiday parks and roughly 440,000 pitches, according to UKCCA, Pitching the Value 2024. Every figure we quote is indicative and is not an offer of finance.

What loan to value and terms can we arrange?

For a trading holiday park acquisition we typically arrange in the region of 50 to 65 percent loan to value, measured against the commercial going-concern value rather than a separate residential figure. Stronger cases, freehold parks with proven EBITDA, a durable licence and an experienced operator, sit towards the upper end, while shorter leaseholds, turnaround situations or thinner trading histories sit lower. Terms commonly run from 15 to 25 years, and the repayment profile is usually capital and interest, though interest-only periods can sometimes be arranged at the start of a turnaround or expansion plan. We match the term to the licence position and the business plan so the debt is serviceable in realistic trading years, not just the best one.

Rates are quoted deal by deal and are influenced by the strength of the income, the loan to value, tenure and the borrower's experience. As an indicative guide, commercial park mortgage pricing has tended to start in the high single digits, with fees of around 1.5 to 2 percent and the usual valuation and legal costs. We also help structure the deal around a limited company, SPV or group, since lenders commonly take a first charge over the park, a debenture over the company and personal guarantees from the principals. If you would like to compare park lending with wider commercial options, our sister site Commercial Mortgages Broker covers trading-business mortgages more broadly. These figures are indicative only and are not an offer of finance.

Why does the caravan-site licence matter so much?

The site licence is the legal permission that allows caravans and holiday homes to be stationed and occupied on the land, and it sits at the heart of how a lender views a park. A licence with a long or open-ended duration, a generous number of permitted pitches and few onerous conditions gives a lender confidence that the income can continue and grow. A licence that is short, capped, heavily conditioned, or tied to seasonal occupancy only, narrows the trading window and caps the realistic earnings, which feeds straight through into a lower valuation and a lower loan. Lenders read the licence alongside the underlying planning consent, because the two together define what the park can lawfully do.

When we package an acquisition we obtain the current licence, the planning history and any correspondence with the local authority, and we flag anything that could concern a credit team early. Occupancy conditions are a frequent sticking point, particularly clauses that prevent year-round or residential use, since they shape both the income and the type of buyer the holiday homes appeal to. By surfacing these points before an application goes in, we avoid a valuation surprise late in the process and give lenders a clear, honest picture. We do not give legal advice, and you should take your own solicitor's view on licence and planning matters. Our role is to arrange the finance around the position as it stands, and the figures we discuss remain indicative.

How do holiday-home sales affect serviceability?

On many static and lodge parks, the margin from selling holiday homes to private owners is one of the largest profit lines, sometimes larger than pitch-fee income itself. When an owner buys a static caravan or lodge and sites it on a park, the operator earns a sales margin and then a recurring annual pitch fee for as long as the home stays. A park with a healthy pipeline of new and replacement sales, good plot availability and a desirable location can therefore convert a strong share of turnover into profit. Operator profit conversion averaged around 29 percent in 2024, according to Savills, Holiday and Home Park Update 2025, which underlines how profitable a well-run park can be.

Lenders look closely at this sales line because it can be more variable than pitch-fee income. They want to see a realistic, evidenced sales plan, sensible stock turn and enough vacant or upgradeable plots to sustain it, rather than a forecast that simply extrapolates a single strong year. We present the sales history, the plot inventory and the assumptions behind the plan so the lender can stress-test serviceability with and without aggressive sales growth. Savills reported an average transaction value of around 34,192 pounds per pitch on holiday static parks in 2024, a useful benchmark, though every park differs. We treat all such figures as indicative context, never as a guarantee of future trading or a basis for a finance offer.

What information will lenders ask us to provide?

To move quickly we ask for the same core pack that a park lender's credit team will want to see. That typically means two to three years of trading accounts, recent management figures, a breakdown of income by line covering pitch fees, touring and camping, holiday-home sales, bar, shop and ancillary, the caravan-site licence and planning history, and details of tenure and any leases. We also want a schedule of pitches showing the split between owner-occupied statics, hire fleet, touring and seasonal, plus the holiday-home stock and any sales pipeline. Alongside the park itself, lenders assess the people, so a summary of the operator's experience and the proposed management arrangement matters a great deal.

On the borrower side we gather the corporate structure, whether a limited company, SPV or group, the principals' assets and liabilities, and their wider portfolio if they already run parks. Because lenders commonly require a first charge, a debenture and personal guarantees, we make sure everyone understands the security position from the outset. Where any security would be linked to the borrower's own home, the loan could be a regulated mortgage contract, and we would refer that element to an appropriately authorised firm. We assemble this material into a clear, lender-ready submission so the case is understood on first reading. We do not give financial, legal or tax advice, and all figures we share are indicative.