Your Business and Industry

Supporting you and your clients on the BTL limited company journey

One of the biggest questions landlords have been asking themselves in recent times is, to incorporate or not to incorporate. As ever, the answer lies within the circumstances of each and every landlord and their portfolios.

Holding property in a limited company structure is not always the right solution for everyone. However, it’s evident that this is the direction being taken by a growing number of landlords and the BTL lending arena continues to adjust accordingly in terms of generating an array of solutions to meet these rising demands.

This dynamic was outlined in the latest iteration of the BVA BDRC Landlord Panel research for Q1 2022 which showed that half of landlords intend to purchase their next BTL property within a limited company structure, with 32% planning to purchase as an individual (down from 41% in Q4 ‘21).

Landlords with larger portfolios were more likely to purchase in a limited company structure, with 66% of 11+ property landlords looking to buy in this way, compared to 45% of those with 1 – 10 properties.

From a remortgage perspective, 1 in 4 landlords intend to remortgage within a limited company structure. This indicates that whilst more landlords are making the choice to use an SPV/Limited company for purchases, the cost of moving over properties already owned is not as popular. Landlords with larger portfolios are more likely to re-mortgage within a limited company (33%), whilst smaller landlords typically plan to re-mortgage as an individual (57%).

Around 3 in 4 landlords currently let their properties as an individual, down slightly from Q4 ’21 figures (-5%) with 21% holding at least one of their properties as part of a company.

A figure which increases with portfolio size as 58% of 20+ property landlords are reported to hold some or all of their portfolio in a limited company. For those landlords who have a limited company, on average, 8.3 of their properties are held in this way.

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As demand continues to rise for this product type, so too does the breadth of solutions emerging across the BTL sector. As a lender who has long been active in this space, we have a number of purchase and remortgage options available to match a range of landlord needs. And our team are always happy to chat to our intermediary partners about how we can support you and your clients on this limited company journey. 

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