Rise in buy-to-let mortgages to limited companies
According to the Mortgage for Business 3rd quarter Limited Company Buy-to-Let Index, 63% of applications by landlords purchasing buy to let properties are being made using a limited company structure.
It would appear this is mainly in response to the changes to tax relief on mortgage interest announced by the former Chancellor George Osborne in 2015, figures show an increase in such mortgages of 21 per cent from that period.
In terms of market share, buy to let mortgage products available to limited companies now accounts for 16% of all products, up from 13% in the first half of the year.
The number of mortgages on offer to limited companies has also risen to 195, the figures showed.
David Whittaker, Managing Director, Mortgages for Business said “The proposed changes to tax relief on financing costs is likely to affect the way higher rate tax paying residential property investors choose to finance their portfolios. We anticipate that many will go dow the corporate route, particularly SPVs, so tracking supply and demand could prove a useful indicator on the health of the sector”.
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