UFPLS is proving to be popular, but could it unintentionally damage the housing ladder?

15 April 2015

Hargreaves Landsdown have provided a breakdown of their customers’ intentions during calls to the D2C platform market leader and less than 8% of them were on course to exercise the option of pulling all their retirement savings out. A whopping 42% were planning on going into drawdown while nearly 17% were planning ad hoc lump sum withdrawals such as UFPLS.
With much of this money to be invested in the residential property market, more specifically the  buy to let market, this could provide a tricky question to the already challenged housing ladder. Recent research has shown that property investors in this end of the market, on average, keep hold of their asset for twenty five years.

As much of this property is at the bottom end of the market, where costs are low and expected yields attractive, the stock for new homeowners and first time buyers is being restricted. Could UFPLS therefore as an unintented consequence restrict the housing ladder?