Doom and Gloom in the housing market

It is true.

It probably isn't a good to buy your own house using pension money, but it appears that it will be possible.

Depends on market sentiment at the time. If it were to happen now, then it would certainly send house prices through the roof. If, however, the house price crash has taken hold by then, people won't be wanting to put their pension money in a falling market.

Another consideration is that a lot of people have already been puting their money in buy to let rather than a pension, so there may not be so much additional money available.

"Jonathan Bryce" wrote

Even if they are not due to retire for another, say, over 20 years?

In that case, it should not bother them in the slightest what the market value is going to do over the next 5-10 years; they should only be concerned in the eventual price in 20+ years' time ...

If they can't get enough in rent to pay for the mortgage and other expenses, then the investment could actually cost them money, something that can't happen with most other types of investment available to them.

It depends.

I presume you are a London resident where the housing market was overheated and more than slightly overpriced. However outside London house prices remain more stable, they weren't as overhyped to start with (a few areas excepted) and demand remains strong in many areas. Attempt to get a big discount from a rural property in Hants for example and expect to hear the vendor laughing at the prospective purchaser. Houses are still selling, although prices are flat, and the average property seems to be on the market for about 3/12 maximum.

Further north, the property market still appears relatively hot. Cheshire, the usual suspects in the North West (National Parks, AONBs) and in North Yorkshire seem to be still upwardly mobile although slower than in recent years at 1-3% PA.

When it comes to making money from property though, although the easy money is to be found in inflationary growth in house prices, only a fool would rely upon it as an investment. Property development really needs the developer to be adding value to a property, keeping an eye on the costs, and spotting the market opportunities. Such developers can continue to make money even in todays market.

I understand that it will not be possible to put your own houes into a Pension, only investment properties.

tim

Could you rent this property out to yourself? I'm sure someone will find a way.

What's the point? In order for the investment to pay for an annuity and then to pay tax on the income?

I'd sooner sell it and live of the capital tax free!

In message , Steve Firth writes

It's fine as an investment, i.e. income from rental income. If you are relying on trading for an income, then a monkey could have done it over the past 5 years, but the next 5 will be a different story and only the most astute will avoid catching a cold.

IMO, people who were trading in property knowing what they were doing will not have a problem. It's the Sunday dabblers that will run into a brick wall.

Agreed, but there will be lots who started trading 4/5 years ago, and who dont know any different.