It is anticipated that following the April pension changes, we could see a sizeable uplift in sales and purchases of residential property as wealthy retirees with a healthy pension pot start considering their retirement options.
If predictions are right, it is thought the number of pensioners with at least one buy-to-let property will almost double and the increased demand could further increase residential property prices.
For many investors, they feel more comfortable and in control investing in property than an annuity. Residential property is often seen as a safe long-term investment with historically strong capital appreciation compared to current low savings rates. As properties are a tangible asset, many feel more comfortable with this type of investment rather than other complex and less reliable investment models such as stocks and shares.
Equally, there is an increasing trend for couples selling their family home to free up cash to fund their retirement. By downsizing their home and investing their capital in a buy-to-let property this provides a supplemental pension income from the rent.
Purchasing your first buy-to-let looks an attractive income investment due to current low mortgage rates and an increased renters market, but it’s important to consider all aspects. Location is key, it must be where there is a demand for rental property and not only that, you need to find reliable tenants to occupy your property, pay the rent on time and keep it in good condition. Mortgage rates are currently low but the property market is always changing so you need to be sure that whatever happens you can cover the mortgage payments.
Like any investment, there are no guarantees, but if you are considering purchasing a buy-to-let property now may be the time to act.
The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.
