THE PROPERTY EXPERT
A NUMBER of ar ticles in the media recently have reminded those it may affect that there are just three months to go before ‘pension freedom day’.
From this date – April 6 – anyone cashing in a private pension plan will no longer be required to buy an annuity – an insurance contract that pays a guaranteed income for life – and instead they will be allowed to cash in their savings and use the money as they see fit. According to research by Ipsos
Mori – a leading UK market research organisation – about 16% of people who will be cashing in their funds intend to invest their savings in buy-to-let proper ty. These people hope their proper ty will generate rental income they can live off in retirement, with house price inflation leaving them with a valuable asset to cash in later in life or leave to heirs.
The returns can be generous and there is also the potential for considerable capital appreciation. However, anyone contemplating becoming a landlord should be aware of the legal responsibilities and the tax rules that will apply to withdrawals made from pension pots under the new rules. And, of course, there are a number of issues to think about that will require a bit of research to be well prepared, such as, will you pay tax? Do you need a mor tgage? Will inheritance tax be a problem? Is the income on offer wor th it?
Ver y good profits can be achieved with buy-to-let but the finances need to be reviewed carefully, and you shouldn’t do the deal unless the figures work.
For nearly 20 years Gibbs Gillespie has been helping proper ty investors minimize their risks and maximize their returns by providing a tailored – and stress-free – approach to proper ty investment.
Our proven track record comes from a thorough understanding of the residential proper ty market and extensive contacts within the industr y.
Should you be considering this idea with your pension then simply pop in to see us for an informal chat and the best advice to make a success of your investment appropriate to your budget and needs.