It’s been said before and will say it again but the death of the buy-to-let market has become somewhat of an urban legend.
It feels necessary to shout at this stage, rather than whisper, that no, the market is not dead, far from it. But it has changed shape.
A raft of regulatory changes imposed by governments over recent years, along with a series of interest rate rises, has led the sector to become more of a professional field with incorporation increasingly common.
After years of being brow-beaten, the sector needs more support as a key component of the housing market
According to research released by a BTL lender last month, a record 74% of landlords surveyed in Q2 who intend to buy a rental property in the next year will do so using a limited company — up from 62% in Q1.
Typically, limited company landlords manage portfolios and consider their BTL business to be their main occupation.
There are several advantages to purchasing BTL property through a limited company, including the ability to deduct mortgage interest from company income, and paying tax at corporation rates rather than an individual landlord’s personal income tax rate. Limited company landlords can also typically acquire higher loan amounts.
The market is not dead, far from it. But it has changed shape
The number of products offered by lenders for these landlords is also on the up, a sign that the market is growing.
In this supplement we look at the ins and outs of incorporation and the ‘professionalisation’ of the BTL sector, and discuss why the industry, after years of being brow-beaten, needs more support as a key component of the housing market.
