19 Oct 2022
There are many reasons why people choose to buy property beyond the most obvious which is to live in it. One of the main reasons for purchasing is to buy a rental property as an investment but there are of course a range of considerations before taking the plunge.
Something to think about is how to buy it and an increasingly popular option is to do so through a limited company.
Primarily this growth in purchasing via a company that is listed as limited has come about due to the changes in mortgage tax relief rules.
Of course, this route may not be suitable for everyone: smaller landlords, for example, those with just one property and those in the lowest income bracket may not benefit as fully from setting up a limited company, especially individuals who already own the property where they would require to sell the property to the company which could incur stamp duty.
In addition, running a limited isn’t for everyone and some people might prefer to simply own an investment property personally.
There are of course pros and cons to either owning an investment property through a company or doing so personally.
Ultimately, as with all financial planning decisions, it is wise not to make any hasty decisions and obtaining advice from your independent property or letting agent, as well as an independent financial adviser, could save you a great deal of time and money.
Adrian Sangster, Leasing Director, Aberdein Considine said: “We live in what is an uncertain world and when it comes to financial planning it can be a complex area to navigate.
Choosing to invest in rental property can be a very secure investment but there are also risks you need to consider. It’s therefore vital that you take appropriate advice before making any decisions which could affect your current or future financial security.”