Pension freedoms create 'gran-lords'

November 5, 2015 by Brendan

Borrowers

As more people over the age of 50 are becoming landlords, the term ‘gran-lord’ has become a popular description for the 10% of over 50s buying property to let.

More people are buying property as they get older, not only as an investment opportunity, but also as entrepreneurs and to help family members. A new survey by Saga Landlord Insurance, which questioned 10,000 people, reveals that a third of people with a buy-to-let property had become landlords during the last five years. According to the survey, property had been inherited by one person in seven, while one out of 14 people had bought a house to provide a home for a member of the family. Almost half of the survey recipients had bought a property so they could rent it out.

However, being a landlord is cause for concern for some people, according to the survey. More than a third of landlords worried about bad tenants, while 20% were concerned about being able to manage the property as they aged. Sue Green, from Saga, stated that although buy-to-let for older people was an investment, it was also a source of worry for some. One of those concerns is the recent change to tax relief for landlords, which could cause problems.

Older people buying property as an investment isn’t viewed positively by some, who say that younger first time buyers are being forced out of the property market. However, now the new pension freedoms have been introduced, it is thought that more over 50s will take up the buy-to-let challenge. Mortgage adviser offer help and support to all buyers, having completed a CeMAP course to help them to provide advice.