Q. As the year’s race by I am wondering if putting my cash into property is the best way forward to ensure I have a secure pension plan in place for my retirement. I know years ago this seemed popular but having seen the crash questioned whether this really was the best option. However with the stability of the property market now evident I am wondering if I should investigate further down this route, can you advise?
A. From next April, the over-55s will be able to take money out of their pension funds to spend as they wish. While some may travel the world, others will fund their retirement or enhance a diminished pension by buying-to-let. Already one in three people are opting for a property nest egg as opposed to a conventional pension, and the new changes mean that the property pension pot is likely to soar in popularity. The creation of a property pension is a big decision. Where is the best place to invest? Should you buy local or invest in another city which is seeing growth? Rental yields vary from 4 per cent in the city up to 10 per cent outside so it’s important to choose wisely. In my opinion investing in property will only ever be a wise decision. Yes the market goes up and down but ultimately it always recovers and exceeds where it was when you originally purchased. If you happen to be cash heavy where else can you put your money that will deliver a regular stream of decent income, certainly not the banks? To do this well find yourself an estate agent that you can trust and who understands your needs and the reason why you are considering investing in property. They will be able to give you good solid advice on the best type of opportunity for you; they will also assist with the rental and management of the asset to ensure a hassle free experience. It is important to get this right because tenants can be a handful at times and not something that you will want to encounter in your retirement. Having the property fully managed on your behalf means you get to appreciate all the benefits and experience none of the negatives of being a landlord as the agent picks up that side. Later on as the market continues to appreciate and your capital investment grows you can then sell when you feel the time is right to capitalise on your investment.