Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what support his Department is providing to savers with a Help to Buy ISA so that they can access the Help to Buy ISA discount where they plan to purchase a property in the context of the increase in average property prices since Help to Buy ISAs were set up.

First-time buyers can continue to save through a Help to Buy: ISA (now closed to new accounts) when saving to get onto the property ladder. The Government provides a 25 per cent bonus based on the account holder’s balance with a maximum bonus value of £3,000. Those participating in the scheme can continue saving into their account until November 2029 and have until December 2030 to claim their bonus.

As first-time buyers typically buy smaller (and therefore cheaper) first properties, the property price cap of £250,000 for those properties outside London (£450,000 within London) under the scheme therefore allows the government to target support at this lower end of the market and target support at the people the scheme is intended to help. The Government keeps all aspects of savings policy under review.

The Government is committed to supporting people of all incomes and at all stages of life to save, particularly younger individuals and families saving for their first home, through a programme of ‘own your home’ schemes. As well as the Help to Buy: ISA scheme, the following Lifetime ISA scheme is part of a package of measures to help people to save for their first house deposit and increase the supply of low-deposit mortgages for credit-worthy households.

In 2017, the government launched the Lifetime ISA (LISA) to support younger people saving for a first home or later life. Adults under 40 can open a LISA and save up to £4,000 each year until they turn 50. The government provides a generous 25 per cent bonus on all LISA contributions within these limits. These funds, including the government bonus, can be used as a deposit to purchase a first home up to the value of £450,000 anywhere in the UK.

First-time buyers who hold a HTB: ISA account are able to transfer their savings to a Lifetime ISA without any penalties but the funds transferred will count towards their £4,000 annual limit for the LISA (and therefore cannot exceed this figure).

The full list of Government schemes to help people own their own home is available here: https://www.ownyourhome.gov.uk/