Record incorporations

2021 saw a record number of companies set up to hold buy-to-let (BTL) property, with 47,400 incorporated in 2021 across the UK, according to Companies House data.

This is nearly twice the number set up in 2017, when it was announced that investors with properties in their personal names would no longer be able to claim mortgage interest as an expense.

However, the rate of growth in new incorporations fell compared to previous years, with a 14% increase recorded between 2020 and 2021, down from a 30% increase recorded between 2019 and 2020.

While the number of BTL companies running in the UK passed through the 200,000 mark as the country emerged from the first lockdown, by 2021 this figure rose to a new total of 269,300. 61% of these companies were set up since the withdrawal of mortgage interest relief in April 2017.

The average BTL company has been operating for 9.2 years, a figure which has fallen amid the rising number of new incorporations over the last five years.

At the other end of the scale, 7,900 (3%) of the companies have been running for more than 50 years, while 440 have been going for more than a century. Hal (50%) of new BTL mortgages in 2021 were taken out by a company rather than someone buying in their personal name, and 40% of these new purchases went into a company which was less than a year old.

Buy-to-let companies currently hold a total of 583,000 mortgaged properties, accounting for around 29% of all existing buy-to-let mortgages nationally. This figure has increased from 26% over the last 12 months. The bulk of new BTL companies set up in 2021 were in London and the Southeast, with the two regions together accounting for 45% of all new incorporations. Only the Northeast, the cheapest region in the country, saw fewer companies set up in 2021 than in 2020, falling by 6%. Northern Ireland (36%) saw the biggest annual increase, albeit from a low base.