Monday, 2nd June 2014

Buy-to-let to overtake pensions as primary retirement finance

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The value of property owned by Britain’s growing army of buy-to-let investors is fast approaching the value of the entire UK’s workforce pension savings.

At £1.25 trillion the value of property owned by almost two million buy-to-let landlords is catching up on the £1.6 trillion total amassed in workers’ pension schemes.

Platinum Property Partnership, a franchise business that helps landlords create portfolios, said two in three landlords had just one property. One fifth had three properties or more and less than one in a hundred were serious portfolio landlords with 15 properties or more.

The recent resurgence in house prices, in which average prices have risen by more than 7pc in the past 12 months, might further encourage people to invest. Longer-term house price growth is around 6pc per year, according to most reliable measures. This compares well with alternative assets classes such as shares, gilts and bonds.