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Big leap in landlords setting up limited companies for buy to let

The proportion of landlords who plan to purchase their next buy to let property through a limited company has hit the highest level for three years, a new survey shows. 

A substantial uplift from 50 per cent in the first quarter of this year to 62 per cent in the second quarter has been identified by Paragon Bank. 

Just under half of landlords who own between one and five properties expect their next purchase to be through a limited company, rising to over three quarters amongst those with portfolios consisting of six or more buy to let homes.  


The survey of over 700 landlords, undertaken by BVA BDRC for Paragon, found in the next 12 months, some 14 per cent of landlords plan to purchase buy-to-let properties. 

Of those who intend to expand their portfolios, two thirds said that they plan to finance their next property investment through a buy-to-let mortgage, following an increase of four percentage points since the previous quarter. There has also been an increase in the proportion of landlords who plan to fund purchases by releasing equity from existing properties, up from 17 per cent in Q1 2022 to 28 per cent in Q2 2022. 


Conversely, purchasing outright using previously invest funds has decreased in popularity amongst those planning to buy, falling from 14 to seven per cent during the same period. 

“Since midway through the last decade, tax burdens on buy to let investment have increased significantly. Along with the recent rise in overheads bought about by increasing energy and maintenance costs, running a letting business has undoubtably become more costly” notes Richard Rowntree, mortgages managing director for Paragon Bank. 

“It is unsurprising to see more landlords look for ways to reduce their costs, with incorporation being one option for some. 

“Of course, purchasing buy to let property through a limited company may not be the best route for all landlords so it is important that we provide customers with the complete picture to enable them to make informed decisions.”

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  • George Dawes

    Fortunately one of my properties has been owned by a limited company from the early 60's

    Not planned but looks like it was a good idea !!!

  • icon

    Until we know more about the white paper and the EPC C mess i will be doing nothing, sellling the lot is on the cards so for now........ all stays the same.


    Fair point - I did start buying only properties that are C and above to try and future proof things. I suspect they will be forced to back down on these targets though, as they will make millions of properties obsolete and there’s no plan to do anything about that.

    I am now looking at other areas that are not so much under the “let’s all please the activists” spotlight. I also now only buy properties that would work as mini HMOs and could also be used as serviced accommodation to try and keep my options as open as possible.


    Agreed, wait and see, non of this is law yet, a lot could change.


    Serviced accommodation seems a relatively simple option. You just have to arrange regular cleaning (possibly daily) and people can rent for short or long durations.

    I am not sure if there could be a planning issue, but I believe serviced flats are C3 residential use.


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