Saving for retirement is an important part of retirement planning. The sooner you begin saving, the better prepared you will be for your retirement – and the more benefit you will receive from the available pension tax reliefs. Effective investment of your pension scheme is one way to combat the erosive effect of increasing inflation rates.
Here are some of the key points you need to know about pension property investment:
1. What is pension property?
Pension property offers a unique opportunity for investors to take control of their retirement fund. ITC pension investors can acquire property in Ireland or the UK as part of their investment strategy.
2. Why invest in pension property?
You have the ability to choose the property you wish to invest in, whether it is residential or commercial. You can also use two or more pension schemes to purchase one property jointly. In certain circumstances, borrowing can be used in order to help with the purchase of property that may be valued higher than the available funds in your pension fund.
3. And, why now?
The latest DAFT report states that house prices and rents continue to increase nationally, with the average market rent, per month, rising from just over €1,400 a year ago to €1,567 in the first quarter of 2022. Rents in the first quarter of 2022 were, on average, 11.7% higher than a year previously, across the country, the strongest year on year increase in market rents since late 2016. (The Daft.ie Rental Price Report 2022 Q1)
Housing prices jumped by 2.4% on average during the first three months of 2022, with the average listed price at €299,093, which is up 8.4% on the same period in 2021. (The Daft.ie House Price Report 2022 Q1)
4. What are the benefits?
Investing in pension property offers full flexibility to the investor to take control over the pension and to use their own knowledge of the market to seek out valuable opportunities. Furthermore, you will not be subject to Income Tax on the rental income or Capital Gains Tax on any gains made, and any costs in connection with the property purchase are consumed by the pension fund.
For further information, please speak to your Financial Advisor or email email@example.com.
Make sure to keep an eye out for part 2 coming soon!
*Please note this content is the view of the author and not of Independent Trustee Company