PRSA - property

Hi All - apologies if this has came up already. Would love some advice on this if at all possible?.

Have just left a company and am bringing a 48K (40.5k from that employer and 7.5k from previous transfer)

Personal situation - have some rental properties but rent myself where I live. Is it feasible to use this 48K within a PRSA and buy a property in Dublin (rent it to myself or family member) and live in it. It would be ideal if I could use this money as a deposit so to speak for the PRSA. I'm sure this is not the ideal scenario for this but legally would I be able to work it?.

Thanks in advance for any comments.

No, you can't on loads of levels. Any property transactions have to be at arms length, so you can't rent it to anyone connected to you.

Banks aren't lending for residential properties through pensions.

If you have more than 15 years service with your past employer, you can't transfer it to a PRSA.

Steven
www.bluewaterfp.ie

Thanks Steven - appreciate the quick response.. yes, less than 15 years.
so banks aren't lending for this at all?..

so technically speaking - could I buy a property down the country for 48K and rent it out?. (no mortgage involved?.) Thanks

Yes, you could.

And no, the banks are lending for these. The loans are non recourse as the pension fund owns it and not you, so they can't come after you if the pension fund defaults.

Steven
www.bluewaterfp.ie

What does PRSA stand for? Is it accumulated Pension lump sum?

And the OP can actually buy a property to rent out using this Pension lump sum. Is this to get a better return than leaving it where it is now?

Personal Retirement Savings Account. It's just another type of pension plan that the government brought out a while back (2002 I think).

You can buy a property with any type of pension plan. The main insurance companies won't offer it but there are plenty of specialist companies that will.

Will you get a better return? That's debatable. You still have to pay pension charges and management fees as well as all the other costs of being a landlord. And will a house/ apartment bought down the country for €48,000 get a better return than investment in a global basket of shares or going into a unit linked property fund where you buy an entire shopping centre or office block?

I won't take the risk, very illiquid, no diversification and not buying in an area that will see high growth.

Steven
www.bluewaterfp.ie

And there I thought I'd seen every way for people to over-invest in Irish residential property.