Does property still work as a retirement fund?

It is undeniable that property investment has been a cornerstone of wealth creation for generations in Britain. As a quick example, we bought a £200,000 flat in SE London in 2017 which is now valued at £350,000 while it has continued to generate a modest cash flow all this while. While property values can fluctuate, they tend to appreciate over the long term, offering a valuable asset that can supplement retirement income. But do not underestimate recent tax changes and the time-consuming nature of property management. Also, the age-old adage that "bigger is better" holds particularly true today. For properties to be a worthwhile investment, you need to be a structured, professional investor with a substantial scale. Any other way, and it is unlikely to yield attractive returns. On the other hand, pensions offer structured and tax-efficient savings vehicles with automatic contributions through employer schemes, tax relief, and diversified investment options for small investors.

Many old sayings stand the test of time and prove true again and again, in this case, it's "don't put all your eggs in one basket". Any well-constructed retirement plan should have a basket of different assets - pensions, ISA's, property, etc. This allows different elements to be accessed at separate times when the market conditions are optimal, so if the property market is down at the time you wish to retire you can access cash from some of your other assets and leave the property to recover before you sell it or raise cash against it with a lifetime mortgage.

The short-term blip in UK property prices is definitely not a reason for consumers to stop either improving their homes or investing in the property market. What is causing concern for residential landlords investing in properties is the endless list of problems affecting this market e.g. EPC, new tax criteria, stricter lender underwriting conditions, minimum bedroom size implications etc, etc etc. Residential landlords do need a let up in these problems and fast unless the government has some great plan to build more council housing - was that a pig I saw fly past?