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Limited company property lets hit new high – Hamptons International

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  • 16/07/2018
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Limited company property lets hit new high – Hamptons International
Almost one in five rental properties are owned by limited company landlords with the proportion having almost doubled in the last two years.

 

 

According to data from Hamptons International, 18% of properties let in the first half of 2018 were owned by a company rather than an individual.

This was up 4% compared to the first six months of 2017 and 8% higher than in H1 2016. It also tops the previous high recorded by Hampton’s in 2010 which was 14% – the first year of its survey.

 

Cheaper homes for limited company

Yorkshire and the Humber had the highest proportion of rented homes owned by a company landlord with 25% of homes let in the region owned by a company landlord.

This figure was 20% in the North West and 19% in London, although the capital topped the list last year but has since fallen back.

The lowest was the West Midlands with 15% of properties being owned by limited companies.

Company landlords appear more likely to rent out cheaper homes than individuals, with almost double the proportion of properties being rented at less than £500pcm – 35% to 19% respectively.

Furthermore, 54% of limited company properties are rented for between £500 and £1,000pcm, compared with 67% of properties owned by individuals.

And one in ten rented homes owned by a company landlord were registered overseas.

 

Rent rises slowing

The Hamptons International data also showed the average cost of a new let in Britain rose to £956pcm in June 2018, but rental growth slowed to 0.7% down from 1.3% in May.

Rents rose the most in Wales, up 4.1% year-on-year, followed by the East (2.3%) and the Midlands (2.2%).

Rents in the North were flat year-on-year following two consecutive months of falls.

Hamptons International analyst Aneisha Beveridge said: “Nearly one in five homes let so far this year were owned by a company landlord, almost double the proportion in 2015, before the tapering of mortgage interest tax relief changes were announced.

“Companies are generally taxed more favourably, so in many cases landlords can make cash savings by operating through a company rather than as an individual.”

She added: “Rental growth slowed in June, falling below 1% for the first time in seven months as the shortage in stock begins to level out.

“The lull in landlord purchasing activity following the stamp duty surcharge for second homes appears to have bottomed out as investors find new ways to make their returns.”

 

 

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