28% of would-be landlords considering buy-to-let to boost their retirement income do not know how to apply for a mortgage to get started, according to research commissioned by Kensington.

54% of over-40s retirement savers would consider investing in buy-to-let to increase their income in retirement, providing some support for the idea that there would be a boost for buy-to-let following the launch of pension freedoms.

When it comes to choosing the right product, around 44% would use a broker to source a buy-to-let mortgage while 28% would go to their existing lender.

Kensington’s analysis of average flat and maisonette prices across England and Wales shows the 25% deposit need for a first-time landlord taking the plunge following pension freedom is nearly £43,000. It ranges from £8,128 in Blaneau Gwent in Wales to more than £104,000 in Greater London.

Would-be landlords considering investing pension cash believe the risk of failing to achieve a comfortable level of income is the biggest risk. Around 47% of those questioned are concerned about the risk of not achieving the income they want followed by 42% who fear investing in buy-to-let could mean running out of money in retirement.

Around 25% are concerned about the income tax implications of withdrawing pension cash to invest while 21% fear they will not understand the rules on buy-to-let.

Steve Griffiths, head of sales and distribution at Kensington, said: “The outlook for the buy-to-let market is bright and the potential for further growth as pension freedoms come into effect is undeniable.

“However the would-be landlords will need to be realistic and it is worrying that so many are considering buy-to-let without knowing how to apply for a mortgage. Advice from brokers on mortgages is vital.

“Claims of a wall of money are unlikely to come true and in any case raising a 25% deposit for a buy-to-let mortgage from pension funds will be tough as a look at average property prices across the country shows.”