Pensioners Will Be Competing With First Time Buyers
First time buyers will be put under further pressure next month as pensioners look to take advantage of the reforms introduced by the Chancellor last year. There is already stiff competition amongst buyers because there simply isn't enough housing stock to go around but this looks set to become worse because there will be a big influx of pensioners looking to buy to let.
For many years pensioners have been forced to invest in the stock market or buy annuity policies that paid a pittance. Now they will be able to invest in bricks and morter and join the ever growing army of buy to let landlords. From April 6th New pension laws mean that people will be able to unlock their cash in their pension in one go and spend it on whatever they want and property is liklely to be quite high on thir shopping list.
First Time Buyers Squeezed Out Of Housing Market
First time buyers should be concerned because there is a strong possibility that they could be squeezed out of the market particularly as many of the pensioners will have cash funds and will be able to buy a property very quickly. They will not be looking to take out mortgages which in itself can be a very slow and protracted. Instread tey will be able to agree a sale on the basis that they can complete any sale without having to jump through hoops.
This is not good news for other buyers and could push homeonership out of the reach for many young people. Some experts are concerned that house prices could also be pushed higher very quickly as people clamber to buy whatever is on the market. There is going to be so many people looking to buy property that house prices could be pushed to levls not seen before with a limitless supply of money
Pensioners Can Spend Their Pension Pots On Property
Some experts believe the pension reforms are a big mistake and that the Chancellor has acted irresponsibly by allowing people to do what they want with their pension pots but many pensioners feel as though they have been ripped off for long enough and are delighted that they can at last invest their own hard earned money and not be forced to rely on some pension fund manager to charge them a fortune in management fees.
The pension industry has been beset with scandals over fees and charges over the last decade and many have heaped praise on the government for freeing them of their financial shackles and allowing people to make their own financial decisions .
The pension reforms could also hit would be landlords because banks and building societies may look to pull out of the help to buy market if it is seen as overheating. They will not want to buy into a market if they think that prices could come down particularly if a bubble is being created by wealthy pensioners. To find out more about what you can do with your pension from April please visit the .gov pension advice page here