Your comments: Property pensions

Some property companies are using the changes to lure new buyers

Residential property can soon be bought with generous tax breaks through personal pensions.

The government has admitted that this type of investment will be inappropriate for most people.

But critics are arguing that not enough is being done to publicise the risks.

We asked for your comments on the issues that our programme raised.

This debate has now closed.

A selection of your comments are below.

The comments we publish are not necessarily the views of the BBC but will reflect the balance of views we have received. It is helpful if contributors state if they work for any organisation relevant to an issue discussed. Readers should form their own views on whether messages published represent undeclared interests, or views prompted by a common source.

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Your programme confirmed that SIPP revisions will benefit the very rich the most. How on earth can the government justify this? Doesn't it care? This goes beyond "tidying up" the rules.

Although house price rises are currently slowing, buy-to-let must surely have contributed to price increases in recent years, which now means that for many young people, it is virtually impossible to purchase a property.
Peter Dunn, London

The chancellor's policy of encouraging a credit boom based on house price inflation has clearly run out of steam this year.

I think he saw this coming, and plans the pension change to squeeze another rise out of the housing market irrespective of the long term advisability of these investments for pensions.
Andrew, York

I was very pleased to hear that at least one programme has been produced to counter the hype produced by the press about residential property.

Until I stepped down this year I had been chairman of the SIPP Provider group for four years.

It has always been clear that this sort of investment would only be suitable for a very small number of people and the statement you read out from the Inland Revenue simply reflects their longstanding view on this topic.

Your programme highlighted many of the problems which have always been well known to the providers, trustees and administrators of SIPPS Martin Cadman, former SIPP Provider group chairman

Your programme highlighted many of the problems which have always been well known to the providers, trustees and administrators of SIPPS.

I think that very few, if any, of us are enthusiastic about residential property as an investment, and suspect that very few providers/administrators will wish to take on this class of investment.

Those who do will insist on very stringent safeguards being put in place; as trustees would otherwise be very exposed to any problems.

This probably means managing agents in every case, with the agents taking responsibility for managing all aspects of the investments.

The same sort of considerations apply to all the other esoteric investments promoted in the press!
Martin Cadman, former SIPP Provider group chairman

The scheme is only suitable for the rich. This is fairly easy for anyone to see. I believe the government should be doing much more to make people aware of this as I know myself and three friends who were very seriously looking at it but now realise it is not for us.

It could well have been a very expensive mistake had the BBC not broadcast the programme.
Mr White

Excellent, balanced programme, a topic that needs a wide airing.

I was initially worried that SIPPS would make the life of first time buyers - already aged in their mid 30s - even more difficult. This programme redressed the balance.
Dr Mike Henley

What an idiotic idea! Probably the chancellor's worst blunder yet.

After decimating the UK's world leading private pension provision by taking away any tax relief on pension schemes, he is now going to hand the wealthiest sections of society the wildest tax breaks available, even though they already have property portfolios.

In desperation to keep the housing market driving the economy, this is Gordon Brown's answer, and it is pathetic Rob

This gross distortion of the housing market will end in a whole generation being disenfranchised, unless of course you happen to be in the public sector where you'll get state help to buy a house!

The UK economy has proved to be incredibly fragile, a house of cards built on credit. A few interest rate rises have ground it to a halt!

In desperation to keep the housing market driving the economy, this is Gordon Brown's answer, and it is pathetic and wildly irresponsible.
Rob

The Inside Money Programme on Radio 4 was excellent, clear, factual and easy to understand. We need more of this kind of programmes across a wider spectrum of the BBC channels to reach out to a maximum number of people.

I am looking forward to a similar programme on prime time television Jayne

The BBC should help inform people, not encourage them to rush to buy property for all the wrong reasons.

I am looking forward to a similar programme on prime time television. Keep up the good work.
Jayne

Like your listener Helen Visvikis, I was optimistic that the government was providing a simple and attractive opportunity for us to improve our pension prospects by the purchase of residential property by our pension funds.

I even thought that maybe we might even have been able to pass such a SIPP on to our children. But no.

Having listened to your rather well-measured programme, it is clear that once again our elected representatives are not on our side!

These new schemes and "reforms" are designed with such restrictions and complexities that the only beneficiaries will be the usual compulsory army of lawyers and other fee-charging experts.

Another lost opportunity.

We elect the government to help us but instead it simply helps itself to our taxes, which politicians can then so easily use to enhance their own obscene guaranteed pensions. I despair.
Derek Ritson

What a great programme. As a financial adviser, when I first heard about this latest government idea, I thought it would tempt the uninitiated and more importantly the not well-off investor into something which is very restrictive for about 90% of investors.

This problem is only going to get worse Graham Jones, IFA

Indeed as always, if you have plenty of money then it might be a suitable proposition. Once again it does nothing for the relatively poor to make there own provision.

It appears that these schemes are dreamt up by the government to ease the pension problem, and us advisers will have to carry the can for mis-selling years down the line.

Until the government makes it worthwhile putting money into a pension, then this problem is only going to get worse.
Graham Jones, IFA

Why is the expression "tax free" in relation to pensions savings never challenged in programmes such as "Inside Money"?

The savings are NOT income-tax-free. The tax collection is only deferred, until the savings are returned to the saver as a pension, when the tax will be levied.

Furthermore, for some people, savings now may only avoid tax at the standard rate, whereas during their retirement, they may incur tax at the higher rate.
Ken Trees

If a "property pension" forms part of a wider retirement plan then I can see no reason why tax relief should not be available to investors.

We are faced with a significant savings gap when it comes to pensions in the UK.

Allowing residential property within a pension fund will rejuvenate interest in retirement planning and give people something tangible to hold within their pension funds.

It has been possible to use a pension fund to buy commercial property for many years Martin Bamford

The costs and complexity of placing a residential property into a SIPP fund is likely to be prohibitive for many and this will ensure that professional advice is sought before making an unsuitable purchase.

It has been possible to use a pension fund to buy commercial property for many years and very few people have raised concerns about unfair tax relief in relation to this investment opportunity.
Martin Bamford

I wonder how property prices might be affected. Will it mean they rise, and thus create an even bigger gap between rich and poor?
MJ Orman

I hope this is not going to be another disaster for pension funds.

If pension funds are going to invest in houses, imagine the competition for the first time buyers.
Nathan Ganesan

With property prices already having lost the plot to the point where most people in ordinary jobs cannot afford a house, we now have a scheme where the wealthiest among us get 40% tax relief on the purchase of another home and tax free rental income.

This will push up house prices even more, making a disgraceful situation even worse.

Who cares about GDP and capital growth? Give people affordable housing without the need for subsidies and nonsense partial ownership schemes.

Twenty five years ago a young couple could by a small house or starter flat in most areas of the country.

This should always be the case for working people in Britain.
Gordon Stevenson

So the government stumps up 40% of the purchase price of a property and then allows any rental income or capital gains to be free from tax!

This will just push house prices even further into the stratosphere David Hudson

That is one stunning giveaway to the wealthy.

Of course this will just push house prices even further into the stratosphere, leaving ever more first time buyers unable to afford a house.

Is Gordon Brown trying to return us to a feudal society where a huge chunk of the population is permanently excluded from home ownership? This is a scandalous and immoral policy.
David Hudson

"A day" was supposed to herald a significant overhaul of the pension market. It is supposed to stimulate saving for a pension by providing incentives and simplifying the pension regime.

It will simply attract property developers and syndicates and will make no real difference to the pension saving black hole Mario Angeli

There are some real incentives such as allowing people to save more and allowing people to contribute both into an occupational and private pension. Good idea.

But how will the average Joe Bloggs benefit by including a property into his/her pension? Not at all, it will simply attract property developers and syndicates and will make no real difference to the pension saving black hole that exists in this country.

Mr Blair will benefit, but not Mr Bloggs.
Mario Angeli

This in no way addresses the current pension crisis.

It just seems like a tax break for the wealthy - which I wouldn't normally care about - except that, for the rest of us it will mean rising property prices and more people forced into renting, as those who can afford it rush to buy cheaper housing to rent out.
Ian Murdie

I am seriously considering investing in a buy-to-let property held within a SIPP, as I am very concerned about the risks of conventional annuity based pensions.

I am seriously considering investing in a buy-to-let property held within a SIPP Rob

Due to restrictive planning laws, house prices are unlikely to fall very far, whereas share values can easily collapse and annuity rates have halved in the last 10 years.

It is all very well politicians whinging about such property pensions, but they and the rest of the public sector are well insulated by their "fat cat" pensions subsidised by hard working tax payers who mostly do not have access to such arrangements.
Rob