250,000 Help-To-Buy ISAs opened since December
05/02/2015
The new Help-to-Buy ISA has proved to be a success so far with roughly 250,000 people choosing to open an account since its launch on the 1st December.
Chancellor George Osborne has announced that the Help-to-Buy ISAs have been opened at a rate of one every 30 seconds, or about 3,000 people a day. Data from banks also shows that 75% of the new savers are under the age of 30.
Help-to-Buy ISAs were unveiled in the budget last March, and give first time buyers who are saving for a home a top up of £50 for every £200 they save towards a deposit. Account holders can save up to £12,000 into the ISAs, with a top up of up to £3,000 from the Government.
Critics of the Help-to-Buy ISA have claimed that the scheme could increase demand for homes without doing anything towards the supply, pushing house prices up even further. It has also been highlighted that the £2 billion cost to taxpayers could have been uused to build thousands of affordable new homes.
George Osborne said:
“The best thing the government can do is to make sure that homes are being built for families in the right places and we have the right infrastructure.
“The fact that so many people are making use of the help-to-buy Isa says to me that there’s a lot of pent-up aspiration there, there are a lot of families who want to get on the housing ladder.”
Campbell Robb, the chief executive of housing charity Shelter, said:
“The fact is, with house prices soaring by almost £20,000 in the last year alone this is nothing more than a drop in the ocean. In many parts of the country even the maximum amount you could save with government help won’t be enough for a deposit and, with half of renters’ incomes swallowed up by housing costs, for millions, saving anything at all is impossible.
“This money would be far better spent on building homes that people on ordinary incomes can actually afford to rent or buy in the first place.”
Need financial advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Can Home Information Packs Survive?
News that the laws governing Home Information Packs (HIPs) are not being adhered to 12 months after they were introduced is a shocking reflection of a policy which the UK government brought in against the wishes of the industry. The idea was sound, one survey to cover one house sale, but the cost (£400) and the fact that many surveys were being ignored as finance companies were not accepting the...
Read MoreMortgage liquidity is the key to the UK economic revival
While there is no doubt that the UK economy has shown signs of life over the last few months, there are serious concerns that a reduction in mortgage liquidity in 2010 could force a second slump in the UK property sector. An influential report by Ernst & Young highlights this particular issue and seems to be gathering more and more supporters in the city. So what exactly is happening?
Read More
Self cert mortgages 'not just for self employed'
The number of people taking out self certification mortgages is rapidly picking up speed, according to a leading mortgage expert.The Intermediary Mortgage Lenders' Association (IMLA) attributed the increased popularity to the fact that more people now do freelance work or have several jobs. Anyone taking out a self certification mortgage does not have to provide proof of their income such as wage...
Read MoreDo tracker mortgages really work?
While the idea of mortgage tracker funds is to basically track the level of interest rates in the UK, do they always deliver what they promise and are they as readily available now as they were before?
Tracker mortgages have become very hot news across the UK as interest rates continue to come under pressure after the last 0.5 percent cut to 4.5 percent. There is even talk that rat...
Help to Buy scheme extension launched
09/10/2013 The second stage of the ‘Help to Buy’ scheme has been launched three months early in the hope that the housing market will further benefit from growth in a similar way it did under the initial stage of the scheme. The scheme was originally launched with the intention of helping home buyers find a mortgage, even if they did not have a vast amount of savings. This has been achie...
Read More