Pension or Property Investment – Manchester is a good bet

Since April 2015, over 55s in the UK have had a much greater level of freedom with how they can spend their pensions.


Pensioners have always had the freedom to withdraw up to 25% of their pension in a tax-free lump sum but, since the Pension Reform, they can now withdraw the whole amount in a number of smaller lumps with 25% still being tax-free.


As a direct result of this , more and more pensioners are looking to the Manchester buy-to-let market to fund their retirement because of concerns that they might not have saved enough for their retirement.


There are a number of buy-to-let mortgage deals on the market and those at pension age are increasingly cashing in their pensions to buy properties in Manchester.


Naturally, there are many things you need to consider before using your retirement money for property investment. Entering a higher tax bracket and potentially facing larger tax bills are all concerns that need looking at with your financial advisor but having said that, there is no doubt that property investments in Manchester have gone from strength to strength over the last few years and they continue to outperform traditional forms of investment such as ISAs, bonds and equities.


The growing rental market


Over the last 10 years, the Manchester population has increased significantly and has easily outstripped the supply of new homes. The growth in the city centre population of Manchester has also been a huge factor. This has created the need for more rental property in the city.


In addition to this, student numbers across Manchester have increased and this has created a strong demand for PBSA (purpose-built student accommodation) that, for investors, can yield high returns which are virtually guaranteed. The centre of Manchester is now a good mix of PBSA and prime city centre developments which cater for the high numbers of students and young professionals in the city.


If you throw into the melting pot the rising house prices and the lack of affordability for many first time buyers, it’s no surprise to see the rental market grow so rapidly in Manchester.


In light of this, it’s easy to see why many pensioners are looking at property investment in Manchester rather than ISAs, bonds, equities etc to fund their retirement. If you’re over 55 and considering using your pension to invest in property, then we have some fantastic opportunities in Manchester that we would like to discuss with you. Please contact us now on 03333 001 888.

9 May 2016
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