Scottish launch for platform helping investors access buy-to-let market

A platform that aims to make it easier for investors to access the buy-to-let market has been launched in Scotland.

GetGround enables investors and landlords to set up limited companies to buy rental property, and then manages these firms on their behalf to reduce the administrative burden.

The platform’s expansion north of the Border comes as new figures show that more than 2,000 limited companies were established in Scotland to invest in buy-to-let properties in 2021.

The figure was a 23 per cent rise on the previous year and continues a shift towards holding properties within companies after tax changes meant investors who held such assets under their own name would no longer be able to claim mortgage interest as an expense.

Investors who hold properties across the UK will be able to view their portfolios on a centralised platform following a tech firm's expansion into Scotland. Picture: Christopher Furlong/Getty Images.

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While individual landlords are effectively taxed on turnover, company landlords are taxed on profit. This has meant that for some – particularly those who are higher-rate taxpayers – it has become more profitable to move their buy-to let properties into a company.

GetGround has been available in England and Wales for some time and founder Moubin Faizullah Khan – who moved into business after qualifying as a doctor – said the Scottish market was highly attractive for investors.

“Scotland is home to 15 per cent of all UK buy-to-let and offers rental yields considerably higher than London or all-UK averages – making it an attractive investment destination for UK and overseas investors,” he said.

Rental yields in Scotland stand at 5.8 per cent, far higher than the 4.3 per cent average across the whole of the UK, and almost 50 per cent higher than in London where average yields of 3.9 per cent barely outpace inflation.

GetGround provides investors with a centralised platform on which they can view their UK property portfolio in a single place and compare and assess the performance of individual properties against one another.

Visibility

Mr Khan said the expansion to include the Scottish market would enable the many investors who own property in multiple parts of the UK to manage and maintain visibility over their portfolios on a centralised platform.

Meanwhile, new figures from property firm Hamptons showed that last year saw a record number of companies set up to hold buy-to-let property. In total there were 47,400 new buy-to-let companies incorporated across the UK, nearly twice the number set up in 2017 when the tax changes were announced.

The figures also showed that average rent on a new let in Scotland rose by 7.6 per cent to £747. The increase was higher than the average rise of 7.2 per cent seen across Britain, but lower than the 8.5 per cent gain seen outside London.

Aneisha Beveridge, head of research at Hamptons, said: “The way buy-to-let investors hold property has changed, with the impact of the tax changes made five years ago still shaping landlord buying behaviour today.

"But despite record numbers of rental homes being held in companies, the growth in buy-to-let businesses has come from smaller landlords rather than larger institutions who made up most buy-to-let company-owners pre-2016. Today, only 20 per cent of buy-to-let businesses hold more than three mortgaged properties, a similar profile to landlords who hold homes in their personal name.”

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