{"id":6100755,"date":"2025-01-22T11:57:42","date_gmt":"2025-01-22T11:57:42","guid":{"rendered":"https:\/\/www.buyassociationgroup.com\/en-us\/?p=6100755"},"modified":"2025-01-22T11:58:45","modified_gmt":"2025-01-22T11:58:45","slug":"limited-company-landlord-20","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-us\/news\/limited-company-landlord-20\/","title":{"rendered":"Properties owned by limited company landlords have doubled since 2020"},"content":{"rendered":"

The number of limited company landlords has been on the rise over the past decade, and there are now more mortgage products than ever to cater to this segment of the market.<\/h2>\n

Limited company landlords<\/a> continue to reap the benefits of operating as a business rather than an individual, with new research from Paragon Bank<\/a> revealing that the proportion of incorporated property held within the portfolios of limited company landlords has more than doubled since the first quarter of 2020.<\/p>\n

The report revealed that out of 12% of landlords who own their properties through a combination of both individual ownership and limited company, an average of three quarters (76%) of their total portfolios was incorporated by the end of Q3 2024.<\/p>\n

This is a huge rise compared with figures from 2020, when just 36% of limited company landlords’ portfolios were owned within the limited company, with the rest under personal ownership.<\/p>\n

However, the majority of landlords overall in the UK still own their buy-to-let properties<\/a> as individuals rather than limited companies, at 79%. The trend is much more prevalent among landlords with larger property portfolios, indicating the benefits may be greater for larger-scale landlords.<\/p>\n

Paragon found that only 7% of landlords who own between one and three properties operated via a limited company, while 28% of landlords with four or more properties were incorporated through a limited company.<\/p>\n

One size doesn’t fit all<\/h3>\n

One of the biggest driving forces behind more limited company landlords emerging in the market over recent years has been changes to the way property income is taxed since the introduction of Section 24.<\/a><\/p>\n

Some landlords can save money by operating through a limited company as they can still claim 100% mortgage interest relief on their income, while individual landlords can no longer claim this relief. However, not everyone will be better off.<\/p>\n

Louisa Sedgwick, Managing Director for Mortgages at Paragon Bank, said:\u00a0\u201cThe trend towards holding properties in limited companies doesn\u2019t seem to be slowing down. In fact, these figures show that it\u2019s actually growing amongst landlords who have found it can deliver benefits, particularly around how much their income is taxed.<\/p>\n

\u201cDespite this, we see that the majority of properties, 79%, are owned solely in individual names, hinting at the potential opportunities for limited company lending business. Brokers can add another string to their bow by generally upping their knowledge of what\u2019s involved and, more specifically, the lenders who are good at managing this type of application and their criteria.\u201d<\/p>\n

She added: \u201cIncorporating portfolios isn\u2019t going to be the best move for all landlords so we\u2019d always recommend that they seek professional advice, typically from a tax adviser or accountant.\u201d<\/p>\n

Why be a limited company landlord?<\/h3>\n