Help to Buy ISA is deception

Wednesday 24 August 2016

Last week there was more damning news for first-time buyers looking to get on the housing ladder as it came to light that the Government bonus for the much lauded Help to Buy ISA would only be awarded to savers after the sale of the house had completed.

The Help to Buy ISA helps first time buyers to put money aside for that all important first property purchase. They can save up to £200 a month, which the government will then top up by 25%, up to a maximum of £3,000. For couples, this could mean a considerable £6000 towards their first home together.  

However, last week's revelation makes it more difficult for first-time buyers to claim the bonus at the point in the process where they need it most.  

Mark Hayward, Managing Director, National Association of Estate Agents (NAEA) comments on the news that the Help to Buy ISA is only available on completion of a sale:

“This is quite an extraordinary step from the Government and providers to effectively change the goal posts for first time buyers who have saved in a Help to Buy ISA.

"Consumers have been putting money aside on the basis that they believed it would be applied to their deposit on a new home; to now clarify that it is not actually available until completion is the perfect example of a painful lack of transparency and frankly nothing short of deception.

"First time buyers are already struggling with getting on to the housing ladder and this much hyped initiative was welcomed at the time as a way of helping them, but in fact could have ended up costing buyers if they have gone ahead with a purchase believing that the bonus counted towards the deposit.”