UK Buy-to-Let Sector Defies Government Intervention with Steady Growth According to New Study

Despite government intervention, the buy-to-let sector in the UK is experiencing steady growth. A new study by debt advisory firm Sirius Property Finance, which analysed UK government data, found that the number of VAT and/or PAYE enterprises operating in the residential and commercial rental sectors has increased by 2.1% over the past year, with a five-year growth rate of 12.8%.

Currently, there are around 60,000 businesses operating in the sector, with London being the rental investment capital of the nation, accounting for one-fifth of the UK total. The South East and North West are also among the most prominent regional markets. The North East has the lowest proportion of buy-to-let enterprises, accounting for just 2.1% of the national whole.

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North West England Buy-To-Let Sector Leads the Way

In the past 12 months, Wales has seen the biggest increase in businesses (3.5%), while the North West leads the way in terms of five-year growth at 15.4%.

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Tax Efficient Buy-To-Let Investment in a Limited Company

Despite recent changes to Capital Gains and Tax Allowance rules, demand for rental homes remains high, making the rental sector a profitable one to be part of. As such, many landlords have set up their own businesses to improve the profitability of their enterprises, which is driving the increasing number of companies operating in the sector.

Find out more about property investment in a limited company.

Kimberley Gates, Head of Corporate Partnerships at Sirius Property Finance, commented: “The UK’s buy-to-let ecosystem continues to grow and grow despite the increasing number of deterrents put in place by central government, the most prominent of which is probably recent changes to Capital Gains and Tax Allowance rules."

"It would be bold to predict anything other than continued growth in the buy-to-let ecosystem over the coming months and years, especially in densely populated urban areas because as long as homeownership continues to be so incredibly expensive, rental demand will always be strong.”

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