6^th Apr 2018

Landlords have found a new tax efficient method of keeping hold existing BTL properties and funding additional acquisitions. A bridging lender company claims that many landlords are opting to use a SPV (Special Purpose Vehicle) to help them offset the new tax changes and tougher lending rules.

Landlords with four or more mortgaged properties, wishing to expand their portfolios, are facing stricter measures when applying for new BTL mortgages and along with the phasing out of the mortgage interest tax relief, are looking at ways to maximise their profits and increase investment.

The bridging lender's research that landlords are who are taking on bridging loans for buy-to-let purposes are doing so as limited companies rather than as 'private' individuals.

Its report also highlights that landlords preferences for types of properties to invest in is also changing, as semi commercial and HMOs are on the increase.

Scott Marshall, managing director of the company, said: “We’re seeing most of our landlord customers with larger portfolios transferring them into limited company status and using SPVs to help raise the new funding needed for purchases and refurbishments.

“The market in this segment remains upbeat with our share of lending on buy-to-let still strong for a wide range of property acquisition and refurbishment.

“Landlords and property investors have put in place new company structures and strategies to protect their portfolios and maximise future income and growth.

“We’re seeing this in practice and business written on limited company buy-to-lets is strong as the landlords we work with are very well informed on these investment techniques.”

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