Pension-pot property investors undeterred by buy to let tax changes

The changes introduced to the tax and stamp duty levied on buy to let income and property appears not to have deterred older investors from deciding to put money into thge lettings sector.

A Prudential survey shows that one in five over-55s are considering letting out a property - although in this case they are likely to be buying it as a long-term retirement home in which they will live after earning money by letting it out. 

The insurance firm says the trend of ‘buy to let to retire’ appears to be challenging the traditional route of simply selling up and downsizing as a one-off property deal on retirement. Of those over-55s who have already made a buy to let investment, nearly one in three say they had done so to secure a property to live in one day.

Many of those looking to buy their ideal home for retirement will exploit the changes to pension regulations that came into force in April 2015. Some 52 per cent of over-55s say they would consider using a lump sum from their pension savings to fund all or part of the purchase of their ideal retirement property.

And the research also reveals that 17 per cent of those with existing buy to let investments say they chose to invest in bricks and mortar so they could hand down a property to a loved one in the future.

The findings also highlight the popularity of buy-to-let generally among older people.

Nearly three in 10 say they plan to make a buy-to-let investment in the next two years. Of those, 70 per cent say they will be investing in the sector for the first time.