New data released by Mortgages for Business indicates that 63% of applications from buy-to-let landlords purchasing properties are being made through limited companies.
This figure is a substantial rise from the 21% recorded just before alterations to mortgage interest tax relief were announced by previous Chancellor George Osborne in 2015.
Changing trends
There has been a substantial change in landlords’ behaviour, with many investors choosing to incorporate their business.
In contrast, the number of remortgage applications made via limited companies remained at a fairly constant level.
For market share, buy-to-let market products available to limited companies make up 16% of overall products. This is a rise from 13% recorded in the first half of the year.
Further data from the report shows the average rate of a buy-to-let mortgage slipped to 3.3% at the end of September, down from 3.7% in June. Rates for products available to limited companies fell to an average of 4.3%. This means that rates available to limited companies are only roughly one percentage point greater than the average market value.
BLT Ltd companies applications rise to 63%
Rates
A Mortgages for Business spokesman said: ‘Many lenders with product for both personal borrowers and limited companies, offer the same rates to both. At the moment, some of these lenders accept only SPV limited companies, including Foundation Home Loans and Paragon. Some of the more specialist lender and I’m primarily of Aldermore Bank, InterBay Commercial, Shawbrook and our own lending band Keystone Property Finance, also offer the same rates to trading limited companies.’[1]
[1] http://www.propertyreporter.co.uk/landlords/btl-ltd-co-purchase-applications-rise-to-63.html
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