There were 5,312 new limited companies set up to hold buy-to-let (BTL) properties across Great Britain in September, beating the record set in September last year by 28%, Hamptons reveals.

The data also found that last month’s figure represents the third-highest monthly figure on record, following the 5,854 set up in April 2024 and 5,442 in February 2024.

The record number of new incorporations so far this year means there were a total of 46,449 companies set up between January and September, a 23% increase on the same period last year.

Hamptons suggests that the increase has been driven by the different ways BTLs in companies and BTLs in personal names are taxed.

Hamptons predicts that at the current rate, there will be between 60,000 and 62,000 limited companies set up by the end of 2024, exceeding last year’s 50,004 total.

There are now a total of 382,007 companies across Great Britain set up to hold rental property.

Of those, 74% have been incorporated since the start of 2016, the point at which landlords who were higher-rate taxpayers stopped being able to fully offset their mortgage interest from their tax bill.

Meanwhile, Hamptons rental growth data shows that while the average rent for a newly let property in Great Britain hit a new high of £1,384 pcm in September, the pace of growth continued to slow.

Average rents rose 4.5% year-on-year, down from 5.0% in August and 11.7% in September 2023.

Last month marked the first month since March 2021 when no region recorded a double-digit percentage rental increase.

London tenants who moved into a new home faced the smallest rental increases in percentage terms. Rental growth in Greater London has slowed from a peak of 17.2% in August 2023, to 2.1% in both August and September 2024.

However, Hamptons says there are few signs of rental growth slowing much further in the capital given that these figures have stagnated in recent months.

The average rent in Inner London reached £3,284 pcm in September 2024, £1,099 pcm more than it cost tenants who moved three years ago.

Hamptons head of research Aneisha Beveridge says: “While landlord purchase numbers are well down on pre-pandemic levels, there’s been no sign of a slowdown in the number of companies being set up to put them in.”

“Most new purchases are now made in a company structure. However, there’s also been a significant rise in the number of landlords moving homes they own in their personal name into a company to shelter from an increasingly aggressive tax environment.”

“While the benefit of being able to offset mortgage payments before being taxed has been the primary driver for new incorporations over the last few years, more recently rumours of potential increases to Capital Gains Tax or Inheritance Tax are further fuelling the rise.”

“An increase in personal tax rates will only widen the gap between the tax paid by landlords who own homes in their own name or a company name further.”