Limited company buy-to-let makes up 63% of mortgage applications
A significant 63% of applications by landlords purchasing buy-to-let properties are being made through a limited company, Mortgages for Business’ Limited Company Buy to Let Index has revealed.
The figure has increased from just below 21% before changes to tax relief on mortgage interest were announced by George Osborne in July 2015.
In terms of market share, buy-to-let mortgage products available to limited companies now account for 16% of all products, up from 13% in the first half of the year.
By number however, availability has remained stable at 195 because the overall number of BTL products on the market dipped slightly.
The index also reveals the average rate of a buy-to-let mortgage fell to 3.3% at the end of September, down from 3.7% in June.
Of the products available to limited companies, rates fell to an average of 4.3%.
David Whittaker, chief executive at Mortgages for Business, said: “Many lenders with products 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 lenders, and I’m thinking primarily of Aldermore Bank, InterBay Commercial, Shawbrook and our own lending band Keystone Property Finance, also offer the same rates to trading limited companies.”
Data for the index comes from Mortgage Flow, MFB’s BTL product sourcing software and from its own transactional records.