The share of properties held in limited companies by landlords has doubled over the past five years, according to research by Foundation Home Loans.
In the first quarter of 2020 36% of all properties were held within a limited company with this number increasing to 74% by the end of 2024.
These findings came from Foundation’s Landlord Trends Report for the fourth quarter of 2024, conducted by Pegasus Insights.
Over the same timescale, it was found that the average number of properties held within a limited company had grown from 6.3 to 10.6.
Landlords operating with some of their properties in a limited company tend to have larger portfolios - averaging 14.4 properties - than those with companies held in their name. The latter will average a portfolio of 5.2 properties.
One in five landlords now have an HMO property within their portfolio, with the average number being held at 3.1, while this increased to 29% of all larger landlords (those classed as those with 11+ properties).
The number of landlords with a holiday let property was now 6%, with the average number being held at 1.6, while the percentage for larger landlords was 12%.
While landlords are still much more likely to own terraced houses (62%), and individual flats (52%), 10% now own a block of individual flats.
Commenting on these findings, Grant Hendry, director of sales at Foundation Home Loans, remarked this highlighted the impact of mortgage interest relief on landlords and their need to structure property ownership efficiently.
“At the same time, landlords of all sizes are recognising the ongoing need for diversification, particularly across property type, which can often deliver a more sizeable rental yield than ‘traditional’ properties,” added Grant.
“One of the ongoing trends we have seen for some time is that of landlords seeking out these different property types, often housing multiple tenants in either HMO or MUFB structures, because there is strong tenant demand and due to the allure of higher yields.”
