There has been a drop in the proportion of people becoming buy to let landlords in order to boost their retirement income, according to new research.
The findings, from research for company Retirement Advantage, come despite the majority approaching retirement recognising that property represents a significant store of wealth.
Only 35 per cent of respondents said they were likely to consider buy to let to fund their pension plans, with 62 admitting they were unlikely to.
Retirement Advantage says this is a pronounced departure from the almost even 49 per cent-51 per cent split recorded this time last year.
The shift is even more pronounced for over 55s, with just 10 per cent saying they would enter BTL versus 87 per cent saying they wouldn’t – compared with 27 per cent and 73 per cent respectively last year.
According to Retirement Advantage, while the fall in appetite over the last year is striking, there remains a substantial number of existing landlords – with as many as 900,000 estimated to be over 55.
Furthermore, just 20 per cent of people say they are likely to sell their property and move to a smaller one when they retire, down from 26 per cent last year. Among over-55s it has fallen from 22 per cent to only 16 per cent.
“The reduced appetite for entering BTL is no doubt a reaction to new stamp duty surcharges on investment properties and the gradual removal of mortgage tax relief. However … there are still nearly a million landlords over 55 and for those landlords, there are innovative new mortgage options available to increase ways to boost income from investment properties” explains Alice Watson, head of product and marketing at Retirement Advantage.
“At the same time, we know that downsizing is becoming less popular, not least because the fees associated with selling up and moving can be much higher than expected.
“Property can still play a significant role in providing retirement income, though. Indeed, there is a pressing need for it to do so, as pensions and other savings are increasingly unlikely to meet many people’s retirement expectations on their own.”