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

Beyond the walk: Mortgage leaders talk mental health – part 12

The Mortgage Industry Mental Health Charter (MIMHC) began its third annual 144-mile Walk &...

Access Financial Services brings marketing function in-house to boost broker support

Access Financial Services has recruited three marketing specialists as it looks to strengthen adviser...

Equity Release Group backs FCA later life lending review

Equity Release Group has welcomed the Financial Conduct Authority’s Later Life Mortgages Market Study,...

SortRefer joins Ingard Network as exclusive conveyancing partner

SortRefer has been appointed as the sole conveyancing provider for Ingard Network, giving its...

Four in 10 landlords plan to refinance within next year

Nearly four in 10 landlords are planning to refinance during the next 12 months,...

Latest publication

Other news

Beyond the walk: Mortgage leaders talk mental health – part 12

The Mortgage Industry Mental Health Charter (MIMHC) began its third annual 144-mile Walk &...

Access Financial Services brings marketing function in-house to boost broker support

Access Financial Services has recruited three marketing specialists as it looks to strengthen adviser...

Equity Release Group backs FCA later life lending review

Equity Release Group has welcomed the Financial Conduct Authority’s Later Life Mortgages Market Study,...