The number of investors planning on buying their next investment property through a limited company structure is at a three-year high according to mortgage lender Paragon Bank, after receiving an uplift from 50% in the first quarter of the year to 62% in quarter two of this year.
According to data released by lender Paragon Bank, the number of investors looking to purchase their next investment property through a limited company has increased by 12% in the last 6 months, with 47% of landlords who own between one and five properties expecting their next purchase to follow the limited company structure – rising to 78% of investors who have portfolios of over six properties. The survey of over 700 investors and landlords also found that over the next 12 months, 14% of investors plan to purchase an additional property.
“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.” Richard Rowntree, Mortgages Managing Director for Paragon Bank.
Of the investors who were actively searching to expand their property portfolio, 66% planned to finance their future investment with a buy-to-let mortgage, which has also increased from 62% on the previous quarter. In addition, investors looking to purchase their next investment property by releasing equity from their existing properties has also increased from 17% to 28% in the last 6 months, as the investment market remains competitive, rental demand is at an all-time high, and rents continue to rise.
To learn more about how you can purchase an investment property through a limited company structure and off-set costs, get in touch with our expert property consultants today.