Bank of England chief economist says property better than pensions?

In an interview with The Times the Bank of England chief economist, Andy Haldane, said property was “almost certainly” a better investment for retirement and he could not make “the remotest sense of pensions”.

This has caused quite a stir and accusations of irresponsibility considering his current pension pot is now worth a reported £83,816 per year from age 60.

One must wonder if he has even seen the new Clause 24 tax rules limiting mortgage interest relief or aware of the 3% surcharge on Stamp Duty for second homes.

Haldane is also one of the nine Monetary Policy Committee members that meet every month to vote on the level of Bank Base Rate and Quantitative Easing.

In a Question and Answer session The Times asked Haldane what’s better for retirement property or pension?

His reply was, “It ought to be pension but it’s almost certainly property. As long as we continue not to build anything like as many houses in this country as we need to meet demand, we will see what we’ve had for the better part of a generation, which is house prices relentlessly heading north. I would quite like the day to come when that wasn’t the case, but we’ve got a lot of catching up to do.

“I must admit that when I said that pensions were complicated, I hadn’t expected it to be a statement of great controversy. My experience since then has rather reinforced the impression that most other people find them quite complicated too.”

He was also asked if he owned property and said “We have a house in Surrey, I commute unfortunately, and a little cottage on the Kent coast, in Deal. We bought the Surrey house in 2002 for about £600,000.

I couldn’t tell you a single thing about my mortgage, beyond the fact it’s an offset deal.”