More buy-to-let landlords to opt for limited status according to survey

Half of mortgage brokers expect to see more buy-to-let landlords seeking mortgages as limited companies over the coming year, according to a survey from specialist lender Paragon Bank.

The researchers asked 300 mortgage brokers for their views on limited company status among buy-to-let landlords. When it came landlords with portfolios, 49 per cent of brokers expected to see more limited company business, with 45 per cent expecting an increase in non-portfolio landlords.

Currently, a third of portfolio landlords seeking mortgages operate through limited companies, with the figure standing at 15 per cent for non-portfolio landlords.

Only 11 per cent of brokers expected to see more business from buy-to-let landlords operating in their own name.

Louisa Sedgwick of Paragon Bank said limited company status was a growing trend among landlords: “It is a structure that has become increasingly popular with landlords in recent years as they have responded to government changes to the tax treatment of buy-to-let property ownership.

“Owning properties through a limited company can enable landlords to offset finance costs, such as mortgage interest, against rental income. It’s wise for borrowers to seek professional advice because incorporation may not be the best route for all landlords and the benefits can vary based on individual circumstances.”

A separate study by the bank found that 64 per cent of landlords planning to invest in property said they would do so through a limited company, compared to 15 per cent looking to invest in a personal capacity.

Read more about this story on the Property Investor today website. URL – more-landlords-limited-companies.