Limited company structures becoming increasingly popular

Published on

38% of landlords will use limited companies to buy properties over the next year compared to 28% as individuals, according to new research commissioned by Precise Mortgages.

Among landlords with more than four properties the percentage buying new property via a limited company rises to 42% while among those with up to three properties it drops to 31%.

Landlords operating in London are the most likely to be planning to purchase through a limited company.

According to recent research by Precise Mortgages, 89% of brokers expect the number of landlords setting themselves up as a limited company to increase with the ability to continue to claim tax relief on mortgage interest seen as the main motivation.

Around 15% of landlords questioned intend to add to their portfolios over the coming year buying an average of two new properties, the BDRC study found. Around 23% of those planning to buy will add   three or more properties to their portfolio.

BDRC’s research found landlords with larger portfolios are significantly more aware of the Prudential Regulation Authority (PRA)’s lending criteria and portfolio application process changes. 45% of all landlords are aware of PRA changes but that rises to 67% among landlords with four or more buy-to-let mortgages.

However, 74% of those with larger portfolios say the changes have made it more difficult to secure buy-to-let finance, underlining the growing demand for specialist lenders.

Alan Cleary, managing director of Precise Mortgages, said: “Buying property within a limited company structure has become increasingly popular, particularly among larger professional landlords.

“Given the predicted rise in landlords switching to limited company status this year, we can expect this trend to continue.”

COMMENT ON MORTGAGE SOUP

We want to hear from you!
Leave a comment and get the conversation started.
You need to register to post, so please login or sign up below.

Latest articles

Bath BS introduces valuation engine to speed up mortgage decisions

Bath Building Society has launched a new property decisioning engine aimed at cutting delays...

LSL to stage first protection-only conference for advisers

LSL Financial Services is to hold its first conference dedicated solely to protection, in...

Afin Bank brings in title insurance to speed up mortgage completions

Afin Bank has partnered with Westcor International to introduce Perfect Title Insurance across its...

Mortgage deals vanish in days as rates surge

Mortgage deals are disappearing at record speed as lenders scramble to reprice in a...

TAB expands investor relations team as loan book passes £260m

TAB is expanding its investor relations division as the real estate finance and investment...

Latest publication

Other news

Bath BS introduces valuation engine to speed up mortgage decisions

Bath Building Society has launched a new property decisioning engine aimed at cutting delays...

LSL to stage first protection-only conference for advisers

LSL Financial Services is to hold its first conference dedicated solely to protection, in...

Afin Bank brings in title insurance to speed up mortgage completions

Afin Bank has partnered with Westcor International to introduce Perfect Title Insurance across its...