A new property scheme that takes advantage of recent legislation allowing pension schemes to borrow for investment purposes came on the market yesterday.

Under the Geared Assets pension scheme sold by the Irish Mortgage Corporation, pension investors will have first refusal on prime-location city centre apartment developments on the books of estate agent Hooke & MacDonald, a sister company of the corporation.

Customers will also be able to choose properties from forthcoming Hooke & MacDonald portfolios.

Irish Mortgage Corporation is the latest financial services company to exploit a measure allowing pension funds to borrow.

The measure, introduced by the Minister for Finance, Mr McCreevy, in this year's Finance Act, adds a new layer of tax efficiency to property investment.

Canada Life will manage the self-administered pension schemes on behalf of the Irish Mortgage Corporation and the Independent Trustee Company (ITC) will set up the trust.

Canada Life also independently offers a vehicle - the starter small self-administered pension scheme - that facilitates borrowing to buy property using a pension fund.

Other companies to have made a move in the area include property firm the Prestige Group, which has promoted a scheme where customers can fund the purchase of residential apartments in the UK through their pension funds.

However, the Irish Association of Pension Funds (IAPF) recently cautioned individuals not to overexpose themselves to borrowings within their pension funds.

The risks of "significant" loss occurring if the return on the investment is lower than the cost of borrowing are obvious, according to an IAPF paper.