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Value of SIPP/SSAS property purchases up 38%

21 March 2018

Xafinity SIPP/SSAS, part of pension specialist Xafinity Punter Southall, has reported a jump in the number of investors turning to commercial property investments and the value of those transactions.

The firm said 178 commercial property transactions were completed in 2017. The total value of the properties was £62.3m, marking a 38% increase in value on 2016 figures.

Property prices ranged from £35,000 for small offices to several in excess of £1.5m.

Jeff Steedman, head of business development for SIPP/SSAS at Xafinity (pictured), said: “Directors of SME companies are continuing to use their existing pension plans to self invest into their business. Putting property into pensions remains an excellent tax efficient way for SMEs to grow their pension funds for retirement, as the rental income alone can provide excellent growth.”

Xafinity said there was “clearly a huge opportunity” for further growth in this sector, due to the “compelling” tax benefits.

During the course of 2017, over 100 new IFA firms started doing business with Xafinity, according to Andy Bowsher, director of self-invested pensions at the firm.

He called on financial adviser firms to look for financial strength and clean books when selecting SIPP providers.

‘We are just beginning to see the tip of the iceberg on toxic assets emerging for SIPP providers. Strong governance since our SIPP launch over 10 years ago means we shunned the numerous invitations to sell volumes of SIPPs incorporating many ‘interesting’ investments. This is what advisers should be looking at more closely in 2018.”

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