Pension product launched
NON-BANK lender Capitalflow has launched a new pension product, allowing people to buy properties with their pension fund.
The company is looking to source properties via the BidX1 online auction platform, and is targeting people with self-administered pension schemes.
Capitalflow managing director Colum Breslin said the typical customer could be a sole trader, a professional or a business owner.
“In a lot of instances it would be people who have built up a certain pot within their pension fund. Maybe they’re looking at equities at the moment and they’re seeing equities are a little overpriced – there’s a certain element of uncertainty in the marketplace,” Mr Breslin said.
The product sees Capitalflow lend money to help acquire the property, with the balance coming from the pension fund. “For a lot of people the desire is very clear that they want to pay down the property as quick as possible, so the property is unencumbered,” he said.
He cautioned that property is riskier than some other investments and also less liquid than, for example, shares. “You certainly wouldn’t be recommending that somebody put all their pension fund pot on to a property... but for a good product mix it’s a really good asset class to be involved in.”