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Grandin disects SIPPs

With less than six months to go until A-Day, Lee Grandin managing director of Landlord Mortgages, examines what Self Invested Personal Pensions mean for the residential property market.

Grandin says: “The advantages of investing in residential property through a SIPP will only be of interest to a relatively small proportion of the population, it is simply too costly for most consumers. Therefore I don’t believe that they will have the monumental effect on the residential property market that some people are predicting.

“You would need a pension fund of at least 80,000 and to borrow an additional 40,000 to purchase the average UK buy-to-let property. From anecdotal evidence, I really don’t think that most UK consumers have this sort of money either in their pension pot or their back pocket.

“And even if they could access to this sort of capital, they can only contribute 100% of their salary or up to 215,000, whichever is the lesser amount into their SIPP each year. So unless they already have an existing pension fund of sufficient size, they are going to need to save for several years before you can think about investing in residential property.

“From the perspective of an existing landlord or even a holiday home owner, SIPPS are also not that exciting. In order to include a property you already own into a SIPP, you would need to sell it to the schemes trustees and potentially incur a huge capital gains tax bills.

“Anything, that encourages people to save for their retirement should be applauded but I really don’t think that the new regulations for SIPPs will have a revolutionary effect on the residential property market or solve the pensions crisis.”


PFS to hold pensions planning seminars

From October to December the Personal Finance Society will be holding a series of countrywide, half-day technical seminars, on pensions planning pre and post A-Day.The course will look at the opportunities that can arise in advising clients in the run up to April 6 and immediately afterwards. Course tutor Mike Morrison, pensions strategy manager at […]

Estate Angels’ leads look like they could be made up to me

From Kevin Thornton I was interested to read the letter from Christopher Platt (Mortgage Strategy October 3) about buying leads. My first thought is, if these people were not looking for a mortgage is this not cold calling? I have recently been receiving an email per day offering me a lead from Estate Angels or […]

MEX probe into self-cert allegations continues

Mortgage Express is continuing its investigation into allegations that one of its sales team advised brokers how to fill in self-cert mortgage applications fraudulently. A source tells Mortgage Strategy that one broker voiced concerns to senior management at MEX after he was advised by one of its BDMs on how to exploit loopholes in a […]

UKs high net worth growing

A report from independent market analyst Datamonitor reveals that the UK high net worth population grew by 12% in 2004, taking the number of wealthy individuals with more than 200,000 in liquid assets to over 916,000 and this number will continue to rise over the next few years. Many private banking providers are reviewing their […]

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(Another) downhill stroll — retirement planning

A report published this morning by the CIPD (CIPD Employee Outlook March 2015) provides yet more interesting data to the changing landscape of retirement planning. It should be remembered that we are in a period of genuine flux here given that the default retirement age was scrapped three years ago, and new pension freedoms come online in April. Both of these alterations will have a huge impact on how employees plan for their retirement.


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