The number of investors purchasing buy-to-let properties through a limited company rose sharply in the final quarter of 2015. Two out of five of all new buy-to-let applications originated from limited companies and this is setting the trend for 2016. By December last year, new limited company applications accounted for more than 39% of all buy-to-let activity, marking a “step change” in investor behaviour. Landlords are looking for ways to offset the new tax changes taking place this coming year and setting up a limited company is the order of the day. A local accountancy firm in South London commented “new limited companies being set up for the buy-to-let investor is our largest growth area currently”. “It’s not only multiple property owners, we are seeing the single owner follow this route for tax efficiency as well”. “Buy-to-let portfolios via a corporate structure will be more tax efficient, especially for the higher rate tax payer”. The mortgage choice is growing daily with more than 30% of buy-to-let lenders now offering limited company deals. Good news for the borrower is these mortgages are getting less expensive and we expect this to continue into 2016. We are also seeing more lenders entering this market as demand grows, again we expect this figure to continue rising throughout the coming year. Buy-to-let landlords are no doubt going to see big changes taking place in the coming months. The majority of landlords remain confident that the long term future will be profitable as it is predicted property values will continue to rise constantly. Mortgage help? If you require assistance with your mortgage please do call one of our fully qualified advisers.
