The Bank of England’s chief economist has claimed that investing in property makes for a more profitable retirement plan than a pension.
Speaking in an interview with the Sunday Times, Andy Haldane, who has worked for the Bank of England since leaving university, expressed his belief that, ‘Property [is] a better bet than pensions’ when it comes to saving for the future.
Mr Haldane highlighted the supply and demand imbalance in the UK property market as the key factor in his conclusion that property makes a better financial retirement plan than the pensions’ system.
‘It ought to be pension but it’s almost certainly property. As long as we continue not to build anything like as many houses in this country as we need to … we will see what we’ve had for the better part of a generation, which is house prices relentlessly heading north.’
Mr Haldane’s comments follow the introduction of new pensions reforms in April last year, which saw pensioners able to withdraw money from their annuity and place it within other investments and financial options.
The removal of pension restrictions saw a surge of new buy-to-let mortgages become offered on the market due to demand from pensioners looking to invest their money into property.