This tends to be of particular interest to people who are keen property investors and would like to free up money for further acquisitions. Accessing accumulated pension assets to invest in this manner may provide ready access to cash with which to make a purchase. When properly managed, property can also provide the type of fixed return which is increasingly hard to find from conventional pension investments.
Donal Milmo-Penny discusses purchasing property through a pension.
It is possible to buy property directly with a pension where pension assets are transferred into a self directed pension scheme. Self directed schemes are by their nature very efficient, transparent and flexible. Not only may this provide a way of accessing funds, but it also provides a tax efficient mechanism for investing in property.
The key advantages of using a pension for property acquisition are:
In practical terms, the above tax advantages can typically have the effect of doubling an investor's effective yield. Management and related charges can also be billed to the pension.
Who is this suitable for?
Anyone who has accumulated pension assets and wishes to uses these to directly purchase property or to simply gain more control over their pension investments. We use a range of self directed structures the most appropriate of which depends on the persons employment status, the amounts concerned, age and certain other consideration.
We have no prescribed minimum size but generally, for smaller transactions, the amount of pension assets should equal the value of the target property. For slightly larger transactions it may be possible to borrow within the pension structure. In general the larger the size, the more efficiency that can be found in using a pension structure.
If you'd like to discuss your requirements further, you can contact us here.