gnf_ireland
Registered User
- Messages
- 1,441
Hi all
A friend of mine purchased an apartment in 2012, and has lived in it since. There is a mortgage on the property, but its about 120k. The apartment would now sell for around 325k.
He is planning to upgrade in the next 12 months as baby is due in May. The main option open to him is to sell the apartment, pay off the mortgage and end up with a new deposit of 200k. He would ideally like to keep the apartment as an investment, but that would put a major strain on his other savings.
He has enough in his pension fund to purchase the property (>325k). Is it permitted for him to set up a self administered pension fund, let the pension fund purchase the property at market price and then rent it out to completely independent parties. The initial transaction could be supported by two independent valuations, if required.
This would allow him release the equity in the apartment as a deposit for the new property, as well as keeping a strong rental asset (apartment is in Stilorgan in Dublin, very close to the N11 etc). Current rents would be in the region of 1700 per month. He would like to keep the property if he could, as is bullish on property.
Any thoughts ? Is it possible/practical etc? He knows he is unlikely to get a mortgage for the pension property, but that is not an issue or concern for him as there is sufficient funds in the pension for it. Or is it a complete no/no due to the connection between the seller and the pension holder?
A friend of mine purchased an apartment in 2012, and has lived in it since. There is a mortgage on the property, but its about 120k. The apartment would now sell for around 325k.
He is planning to upgrade in the next 12 months as baby is due in May. The main option open to him is to sell the apartment, pay off the mortgage and end up with a new deposit of 200k. He would ideally like to keep the apartment as an investment, but that would put a major strain on his other savings.
He has enough in his pension fund to purchase the property (>325k). Is it permitted for him to set up a self administered pension fund, let the pension fund purchase the property at market price and then rent it out to completely independent parties. The initial transaction could be supported by two independent valuations, if required.
This would allow him release the equity in the apartment as a deposit for the new property, as well as keeping a strong rental asset (apartment is in Stilorgan in Dublin, very close to the N11 etc). Current rents would be in the region of 1700 per month. He would like to keep the property if he could, as is bullish on property.
Any thoughts ? Is it possible/practical etc? He knows he is unlikely to get a mortgage for the pension property, but that is not an issue or concern for him as there is sufficient funds in the pension for it. Or is it a complete no/no due to the connection between the seller and the pension holder?
