View more on these topics

Bee warning over pension property

Scottish Life head of pensions development Steve Bee says the Government has grossly underestimated the boost that residential property in pensions will give to the housing market.

Bee told PIMS delegates on board the Oriana last week that he would put £120,000 in a personal pension on A-Day and use the fund to buy a £200,000 property in France.

He said the Treasury&#39s impact assessment was flawed because it had only considered the 1.3 per cent of personal pension holders who had self-invested personal pensions as likely to invest in property when full concurrency means that occupational sch-eme members will buy property in Sipps. He said people owning second homes would start to do so in Sipps as a matter of course because it is a tax-efficient wrapper.

He said it was inevitable that after A-Day, some of the £1.2trillion in UK pension funds would find its way into the domestic and overseas housing markets, causing upward pressure on property prices.

Bee said: “The pompous regulatory impact assessment did not take into account the changing world. I am in a finalsalary scheme but the first thing I will do after A-Day is put £120,000 into a personal pension and buy a £200,000 property in France.

“You would have to be naive to think that pension money is not going to find its way into property when, after A-Day, full concurrency means everyone can use Sipps.”

Informed Choice managing director Nick Bamford says: “People need to be careful to have a balanced pension portfolio but it could well be that having an overseas property that you rent out and use from time to time will prove attractive.”

Recommended

MPs turn focus on IFAs

Financial services is in for yet another shake-up and it seems clear that IFAs are firmly in the spotlight. The shake-up will come from the Treasury select committee&#39s investigation into restoring confidence in long-term saving. Although the select committee is renowned more for elaborate performances than making any real headway into issues, its latest inquiry […]

ScootElectric mobilises support

ScootElectric is an enterprise investment scheme that aims to raise up to £1m to invest in an electric scooter business. The business was established in January 2002 to import full-size electric scooters to the UK and market them as an environmentally-friendly alternative to cars and public transport. Initially the focus was on supply and the […]

Flat cap does not fit the bill

At last a few facts about the new stakeholder regime. The price is 1.5 per cent of the annual management charge for the first 10 years from April 2005. Products can be sold by lower-level advisers with decision tree and script who must be attached to a regulated business. The threat remains of ombudsman referral […]

Critical cover for children

Childhood illness and disability is a very emotive issue. All of us would rather not think about what could happen and parents rarely want to plan for the consequences of something happening for fear of somehow making it more likely to occur. However the impact of a child being diagnosed with a critical illness would […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment