New study reveals number of landlords looking to use limited companies

A third of buy-to-let landlords are planning to remortgage in the next year, according to new research from Foundation Home Loans. Landlords looking to add to their portfolio are also more likely to do so via a limited company.

Independent market research group BDRC undertook this research on behalf of Foundation Home Loans, finding that 53% of landlords intend to remortgage as an individual. 19% of those surveyed said that they plan to use a limited company. 17% responded that it would depend on their circumstances at the time.

The survey revealed that landlords with 11 or more properties were more likely to remortgage with a limited company – 26% said that they would do so within the next year.

Only 14% of landlords are currently planning to take on new properties over the next 12 months, with 55% of this number planning to do so via a limited company.

Jeff Knight, director of marketing for Foundation Home Loans, commented: “Understandably when it comes to remortgaging there is a continued shift towards the use of limited company vehicles particularly as we see the growth in portfolio and professional landlords who understand the advantages of holding their properties within such corporate structures.

“The ability to secure full mortgage interest tax relief, which is not available when holding properties as an individual, is a clear incentive for the move towards limited company borrowing.

“As a lender we’ve certainly seen a shift towards limited company business and our aim is to offer a competitive product offering, clear criteria and a smooth service for those landlords seeking to remortgage.

“It’s also clear that remortgaging remains the bedrock of the buy-to-let market and, because of that, advisers should be making regular contact with their existing clients in order to ensure they secure that repeat business, and they take advantage of the highly-competitive market that exists.”