Research from moneyfacts.co.uk shows that the proportion of buy-to-let deals available to limited companies has doubled in just one year.
| Five years ago | A year ago | Six months ago | Today | |
| Number of limited company Pproducts | 30 | 133 | 201 | 313 |
| Overall percentage of the buy-to-let market | 5% | 10% | 13% | 20% |
Charlotte Nelson, finance spokesperson at moneyfacts.co.uk, said: “It feels like the buy-to-let market has been hit from all angles recently, and this has left landlords feeling vulnerable and wondering whether it is still worth continuing in the buy-to-let sector. This has resulted in a shift in focus to limited companies, away from individual ownership, which is influencing not just landlords but also providers offering buy-to-let mortgages.
“As the reality of April’s tax changes starts to bite, the proportion of deals available to limited companies has grown dramatically, having increased by 7% in just six months. With the extra pressure in the buy-to-let market and the added interest in limited companies, it is no surprise that lenders have leapt into action and started offering more deals to limited companies.
“Despite the boost in product numbers, borrowers considering this type of mortgage should be aware that they could find themselves on a more expensive deal compared to the rest of the buy-to-let market. For example, the average two-year fixed rate buy-to-let mortgage for those applying as a limited company stands at 4.22% today, whereas the average two-year fixed rate for the rest of the market is significantly less at 2.97%.
“With all the extra legwork a limited company option entails, any borrowers considering it should consult a financial adviser to ensure it is the right route for them.”