The Pension (Chimney) Pot
It is often said that the British people have a particular fascination with property ownership; currently 68 percent of all properties in the UK are owneroccupied. This is similar to the US level and sits broadly in the middle of a range of ownership levels across developed nations.
New research from Hamptons International has revealed that £1.63 trillion of net assets are held in owner-occupied property, compared with £1.41 trillion currently invested across all other asset types in private pension funds. The next largest asset class, equities, makes up 26 percent or just over £775 million of pension fund investments. Despite the current attention focussed on changing pension fund structures and the state pension, this research shows that the majority of the nation’s retirement piggy bank is filled with bricks and mortar.
Moreover, the importance of home ownership as a part of British personal wealth is growing. Recent figures from the Bank of England have shown that equity withdrawal fell by £24 Billion in 2010. In other words, we have reversed the credit-based spending that characterised part of the last economic cycle and are now pouring money back into savings and in particular our homes. It’s no wonder that we are a nation fascinated by monthly house price indices and home renovation programmes.
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