More than a third of people over 55 are planning to buy at least 1 more property in their lives, research by Prudential has found.
The reasons for buying a home were mixed:
- 43% want to downsize
- 33% want to move somewhere more suitable for older people
- 21% plan to move somewhere quieter.
In addition, 18% don’t plan to buy a main residential property. Instead they intend to purchase a second home, buy-to-let properties, development properties or homes for their relatives.
14% say their decision is a direct result of the pension rule changes and 10% think the changes make them more likely to buy a property in the future.
Stan Russell, retirement expert at Prudential, said:
“There was a lot of speculation that the pension freedoms would spark a rush of over-55s investing in buy-to-let property as a means of generating income in retirement. However our research suggests that this hasn’t yet been the case.
“In fact the process of withdrawing cash from a pension fund to purchase property and potentially generate an income is complex and could result in a large tax bill.
“Using money raised from a property sale could prove to be a helpful boost to retirement income for some. But it’s no substitute for starting to save as early as possible to prepare for eventual retirement.”