Buy-to-let will rocket in to the millennium as more people shun traditional retirement plans and invest in bricks and mortar, Bristol & West has forecast.
The bank said it had noted an increase in retirement planners opting to invest in assets they could see as opposed to the more traditional paper-based pension plans and stocks and shares
Richard Hurst, spokesman for Bristol & West, said: “We are seeing a number of people using buy-to-let as a road to retirement. People understand property, it is bricks and mortar. If you had £10,000 to put down as a deposit you can see and touch what your money is invested in
Increasingly forward thinking investors had been looking to when the mortgage was paid off. Then they could either sell the property and take the lump sum from the sale as a pension or continue to save and utilise the rental income. Buoyed by a “tremendous confidence” in the current housing market, buy-to-let looked an attractive option for the more carefree investor
Hurst said: “Obviously value can go down as well as up which is why you need to lend responsibly. But investors could potentially earn more money through property. House prices are still going up. That bestows a confidence in the market. Buy-to-let has been successful for the simple reason that people understand property
The bank said it had also noted an increasing trend in customers taking advantage of its flexible mortgage deals and paying loans off early
Hurst added: “If someone has a flexible mortgage and they make an overpayment it is classified as pseudo tax free. Your money is working harder for you