Increase in landlords planning to buy through limited company
There has been a rise in the number of landlords in the UK who are planning on purchasing their next property through a limited company vehicle, according to new research.
Based on 888 online interviews carried out in September 2019, almost two thirds of landlords plan to purchase their next property through a private company – this is up from 55% in the second quarter of 2019.
The study from Foundation Home Loans found that landlords with larger portfolios were more likely to use this tactic, but only slightly. Just over three fifths (62%) of landlords with between one and ten properties said they would purchase via a limited company next time, with this figure rising to 65% among those with portfolios of 11 or more properties.
Of those landlords who would not be purchasing as a limited company, 26% said they would buy as an individual, which is a quarter-on-quarter rise of 2%. Almost one in ten (8%) said it would depend on the circumstances at the time (down from 13%) and 6% said they would purchase in the name of a partner or spouse (down from 10%).
“The rise in limited company usage by landlords shows no sign of tailing off, particularly as we have a more professional landlord community who recognise the benefits of using such a vehicle,” said Jeff Knight, director of marketing at Foundation Home Loans. “It’s therefore perhaps no surprise to see a growing number of landlords signalling their intention to make their next purchase through a limited company.”