The share of incorporated properties in landlord portfolios more than doubled since early 2020, research has revealed.
The research, conducted by Pegasus Insight for Paragon Bank, revealed that 12% of landlords held properties both individually and within limited companies.
On average, 76% of landlords’ portfolios (13.1 properties) were incorporated by the third quarter of 2023.
This was an increase from 36% (6.3 properties) in early 2020, and nine properties in the same period of 2023.
Individual ownership remained the dominant choice, with 79% of landlords holding properties in their own names.
The rest (9%) had fully incorporated their portfolios.
Limited company ownership was more common among landlords with larger portfolios.
Only 7% of those with up to three buy-to-let properties fully incorporated, while this rose to 28% for those having four or more.
This skewed the average number of properties held in limited companies to 13.1, compared to the overall average portfolio size of 8.0.
Louisa Sedgwick, managing director for mortgages at Paragon Bank, said: “The trend towards holding properties in limited companies doesn’t seem to be slowing down.
“In fact, these figures show that it’s actually growing amongst landlords who have found it can deliver benefits, particularly around how much their income is taxed.
“Despite this, we see that the majority of properties, 79%, are owned solely in individual names, hinting at the potential opportunities for limited company lending business.
Sedgwick added: “Brokers can add another string to their bow by generally upping their knowledge of what’s involved and, more specifically, the lenders who are good at managing this type of application and their criteria.
“Incorporating portfolios isn’t going to be the best move for all landlords so we’d always recommend that they seek professional advice, typically from a tax adviser or accountant.”
