In the news recently we have been hearing about the introduction of a help to buy ISA, designed to help people purchase their first property. With the current high property prices, lower average incomes, and stricter rules on obtaining a mortgage, first-time buyers need all of the help that they can get.

As a government initiative, it’s thought that this will open up the option of purchasing homes to thousands of people who would not otherwise be able to afford it. For those who are interested in learning more about the new ISA, here is a rundown of some of the most important aspects.

• There is no minimum monthly deposit. Every £1 that you save in your ISA will attract 25p from the government, and each month this can be matched up to £200 with a total of £12,000. If you deposit the maximum – £12,000 – you’ll end up with £15,000 (with £3,000 coming from the government.)
• There are no time limits. Regular ISAs generally have to be updated each year and the maximum amount that you’re able to deposit will change, as well as your interest rate. However, with help to buy ISAs it will stay open for four years. This will give more people more time to save enough money to make the most of their interest.
• It will not be available for buy-to-lets. The ISA is only available for people wishing to purchase their first home and are struggling with their deposit. No property investors or existing landlords will be able to use these ISAs to expand their property empire.
• There is no limit. Many people would expect that only one ISA would be available per household, but luckily there will be no limit and anyone who requires one of these ISAs can get one. If you’re purchasing a property with three other people, there’s a good chance you’ll be able to accumulate a large deposit over the four years.
• You will require a deposit. Although regular ISAs can be opened with just £1, the help to buy ISAs will require a minimum deposit of £1,000. It is thought that this will help people start saving now rather than later and get them used to having a lower disposable income each month.

These are just a few of the aspects of help to buy ISAs and we are sure that more information will come soon after it is discussed further and approaching implementation. If you have any questions about buying your first property or buy-to-let, get in touch. We’re one of the finest property management companies in London and are dedicated to our clients’ needs, offering property and block management in Bromley and throughout the entire capital.