The recent overhaul of pension legislation has meant many pensioners will now be able to gain access to their entire pension pot as they wish and without restrictions.
This radical change in the law could see an increase in the number of investments in self build properties as the over 55s look to invest their nest egg into a self build dream.
Organisers of The Scottish Homebuilding & Renovating Show believe a self build investment could be an attractive option for those looking to reinvest their pension because on average a self build property is worth between 15 and 20 percent more than what it costs to build.
Spokesman for the show Michael Holmes said “Now that people over-55 can access a lump sum from their pension pot, we expect to see an increase in interest in self-building among this demographic – who still have the option of a self-build mortgage.
“Buying land and building a home in Scotland for under £250,000 is perfectly do-able and would fulfil many lifelong dreams.”
According to Mr Holmes there are other financial benefits associated with self building that would be of interest to this demographic too. Self-build homes can be free of capital gains tax once sold if the home is a principal private residence before hand. In addition stamp duty is only payable on the cost of the land purchase, and not the build cost or the final property valuation. Both of these factors could significantly boost the return on investment for the self builder.