New ISA for first-time buyers ‘will kickstart’ property market
The Government is replacing the Lifetime ISA with a new savings plan for first-time buyers with no upper age limit.
The launch of a new Isa for first-time buyers is expected to kickstart the property market.
A consultation on the ISA aimed at first-time buyers is now open to comments as ministers attempt to provide a spark to get buyer numbers up.
Simpler
“The Government is committed to making the aspiration of home ownership a reality for as many households as possible,” it says.
“To support that ambition, the Government is today launching a consultation on the implementation of a new, simpler ISA product to support first time buyers to buy a home.”
It went on to say: “Once available this new product will be offered in place of the Lifetime ISA.”
Withdrawn
The ‘LISA’ will be withdrawn because “the complexity … may have dissuaded many providers from offering it, and savers from taking it up”.
Charges for withdrawals from the LISA had put many people off, the Government admits.
And while the LISA was only open to under 40s, the new FTB ISA has no age limit.
Alarmed
Paula Higgins, Chief Executive of the HomeOwners Alliance, says: “We have been campaigning for some time for the Lifetime ISA withdrawal penalty to be scrapped, so the move towards paying the government bonus only when someone buys their first home is very welcome.”
She went on to say: “Removing the upper age limit is also sensible. First-time buyers are getting older, and the current rules are increasingly out of step with today’s housing market.
“But we are alarmed that the £450,000 property price cap may be left untouched. It has not changed since 2017 and is now badly outdated, particularly in London and the South East.”
The consultation details with a deadline of 17 August can be found here
