A survey carried out by the Property Investor Show North has revealed that property investors are increasingly relying on bricks and mortar to provide for their future wealth, rather than pensions and savings.
Over 80% of landlords responding to the survey stated that they were relying on their buy-to-let properties for their future wealth while only 5% are depending on savings and none at all on a pension scheme.
Nick Clark, managing director of the Property Investor Show North, says: “Whilst the results of the survey are astounding, they do represent the increasing feeling of antipathy within the population towards traditional pension schemes.
“With house prices rising and rental yields still lucrative, more people are realising that property is the best investment they have.”
One factor that has influenced the confidence that landlord have placed in property is the 49% capital gains they have, on average, experienced since purchase, on average three years ago. 19% of landlords report over 100% gains.
As the buy-to-let bandwagon has become more populated and given the property price risesexperienced, some commentators have expressed fears that the buy-to-let market may be reaching a plateau point.
However property investors in the UK are dismissing such talk, with an overwhelming 81% expressing their confidence that the buy-to-let market will continue to grow, with only 11% expecting a decline. Additionally, a staggering 91% of landlords are planning on buying more buy-to-let properties, further boosting their old age returns.
The government's plans to allow rented residential property as part of self invested personal pensions is likely to further increase those turning to property to provide for them and their families. Volatile stock markets as well as low interest rates compound the rationale to rely on property for retirement. 98% of landlords reported that they would take advantage of the proposed rule change when it comes in in 2006
Stephen Harper from Millfield Fountain, an independent financial adviser, says: “In Millfield's view property should be a key part of any high value investment portfolio and this is especially so for a pension.
“The recent performance of the equity market has not given investors much cause for confidence in future gains and many alternative investments either offer very low returns or are very risky. Property has consistently been a good investment over any 10 year period of history and it is no surprise that investors are increasingly turning to property for their long term savings”
The Property Investor Show North, which is due to run from June 18 to 20 at the G-Mex Centre in Manchester, will feature over 120 exhibitors and a full program of expert seminar speakers, sharing advice and information on every aspect of property investment.