Over half of landlords planning to use a limited company for next property purchase
According to the latest property industry research conducted by Precise Mortgages, more than half of landlords plan to use limited companies to buy properties in the next twelve months.
The move highlights the continuing transformation of the buy-to-let market.
Limited companies offer a series of financial benefits, including several tax reliefs and lower interest rates which can help to lower the costs associated with the purchases.
The study found that 55 per cent of landlords plan to use one of these limited companies to complete their purchases over the next year, a figure which is more than double the number of landlords who are intending to purchase property as an individual (24 per cent).
This news confirms the rapid increase in the number of landlords taking this route, as, during the fourth quarter of 2018, around 44 per cent of landlords planned to use limited companies, a figure that increased 53 per cent in the first quarter of 2019 and has again increased in quarter two.
Limited companies are most popular with landlords who hold a portfolio of 11 or more properties with over 70 per cent using them for purchases. However, they are also still the majority option for those with less than 10 properties in their portfolio with over half (51 per cent) planning to use a limited company to buy their next property.
Alan Cleary, Managing Director of Precise Mortgages, said: “Despite the challenges in the market, professional landlords have still managed to grow their portfolios over the past year with the use of limited companies, and it will continue to be the most preferred purchase route particularly for those with larger portfolios.
The increased use of limited company status is further evidence of how the buy-to-let market is changing and demonstrates how brokers and their clients need expert specialist support when buying as a limited company or considering switching.”
For help and advice regarding setting up a limited company contact our experts today.
Latest posts by Elizabeth Jennings (see all)
- UK house prices grow by 0.9 per cent - November 12, 2019
- Rising number of parents take legal action over ‘Bank of Mum and Dad’ loans - September 2, 2019
- Over half of landlords planning to use a limited company for next property purchase - August 13, 2019