The growth in the appeal of limited company lending has been evident since 2016 when the 3% investor stamp duty surcharge came into force and the proportion of tax-deductible mortgage interest on buy-to-lets held in personal names began to be phased out. In fact, since the beginning of 2016 and the end of 2020, more companies were set up to hold buy-to-let properties than in the preceding 50 years combined.
This progression was recently highlighted in research from Hamptons which showed that there were a record number of new limited companies set up to hold buy-to-let properties in 2020. Last year there were a total of 41,700 buy-to-let incorporations, an increase of 23% on 2019. The numbers have more than doubled since 2016, rising 128%. This means that at the end of 2020 there were a total of 228,743 buy-to-let companies up and running, an all-time record.