Finance for static caravan and holiday-home parks

Why static parks are funded on income, not land value

It is tempting to think of a caravan park as a field with units on it, but a lender does not value it that way. The land may have limited alternative use under a holiday-only consent, so its worth is tied to the trade it supports. That is why funding decisions start with EBITDA and the durability of the income, and why two parks of the same acreage can attract very different offers. A site with a long pitch-fee tail, a steady sales record and a clean licence presents as a stable trading business. A site with a short consent, churning occupancy or a thin sales history presents as risk, and the loan to value falls accordingly.

For owners, the takeaway is practical. The figures that move a lender are occupancy and renewal rates on pitches, the volume and margin of holiday-home sales, and the proportion of income that is genuinely recurring. Tidy, reconciled management accounts that separate these streams are worth more in a funding conversation than any amount of narrative. We help owners present that picture so the underlying quality of the business is visible to the desks most likely to support it. None of this is advice, and all figures are indicative and not an offer of finance.

The site licence and planning consent

The caravan-site licence is the document that lets the park operate, and its term and conditions sit at the heart of any funding decision. A licence with a long unexpired term gives a lender comfort that the income can continue across the life of a loan, while a short or conditional licence narrows both the amount and the term on offer. Planning consent matters just as much: whether use is holiday-only, what the permitted season length is, and whether occupancy conditions restrict who can stay and when. These conditions shape the income calendar and therefore the serviceability calculation.

We always ask for the licence and the consent early, because surprises here derail deals late in the day. Where a consent is restrictive, there may be scope to evidence a strong trading record within those limits, or to explore variations separately with planning advisers. What we do not do is assume a consent says what an owner believes it says; we work from the documents. Lenders take the same view, so getting this right at the outset saves weeks. This is information only, not legal or planning advice, and any terms indicated are not an offer of finance.

Holiday-home sales as the profit engine

On many static parks, the largest single contributor to profit is not pitch fees but the margin earned reselling new and used holiday homes onto pitches. The park buys units, sites them and sells them to incoming owners, capturing both a sales margin and a fresh stream of pitch fees from the new occupier. A healthy sales operation therefore feeds the recurring income base as well as generating one-off profit, which is why lenders pay close attention to the sales record. Volume, average margin and the age profile of the resident fleet all tell a story about how sustainable that engine is.

Because sales income is more variable than pitch fees, a prudent lender may apply a discount when sizing debt against it, valuing the contractual pitch-fee base more highly. That is not a reason to understate sales; it is a reason to evidence them clearly across several years so a lender can see a trend rather than a single good period. We help owners present sales history in a way that distinguishes underlying performance from one-off spikes. As ever, this is general information rather than advice, and any figures shown are indicative and not an offer of finance.

Tax changes affecting unit owners who let

A change worth flagging for parks whose residents let their holiday homes is the abolition of the Furnished Holiday Lettings tax regime from April 2025 (HMRC and gov.uk). The FHL rules previously gave qualifying short-let holiday accommodation a more favourable tax treatment than ordinary lettings, and individual unit owners who let their caravans or lodges may have relied on them. With the regime removed, the tax position of those individual lettings changes, which can affect how attractive ownership-for-let looks to some buyers.

For a park operator, this is context rather than a direct funding factor, but it can influence the sales market and the profile of incoming owners, both of which feed the trading numbers a lender reviews. We are not tax advisers and we do not give tax advice; owners and prospective buyers should take their own professional advice on how the change affects them. We mention it only so the funding conversation reflects current conditions. Any figures here remain indicative and are not an offer of finance.

Borrowing structure and ownership

Most static parks are funded as unregulated commercial lending, which gives flexibility on structure that residential mortgages do not. It is common to hold and borrow through a limited company or a special purpose vehicle, which can suit how owners manage the business, plan succession and ring-fence individual sites within a wider group. Lenders are comfortable lending to corporate borrowers provided directors give the usual support and the trading covenant is clear. The choice of structure has tax and legal consequences that sit outside our remit, so it should be taken with proper advice.

Because the lending is commercial and the asset is a trading business, personal guarantees, debentures and charges over the company are normal features rather than red flags. We make sure owners understand what a lender is likely to ask for before terms are issued, so there are no surprises at offer stage. Our role is to arrange and introduce, matching the structure the owner has chosen to lenders who can work with it. We do not give financial, legal or tax advice, and any indication of terms is illustrative and not an offer of finance.