Nearly half the homes in England could be unobtainable for those looking to get on the property ladder with the Help to Buy ISA by spring 2017, new research has revealed.
Help to Buy ISAs were introduced in December 2015 and can only be used on properties worth up to £450,000 in London and £250,000 elsewhere.
Online estate agent eMoov analysed the average house price across all 326 districts in England and identified the areas that have exceeded the maximum property values eligible for the Help to Buy ISA.
It found that a staggering 46% of houses in England would exceed the Help to Buy ISA limit by spring of next year.
Help to Buy ISAs give first-time buyers saving for a deposit the opportunity to put away £200 a month in a dedicated ISA that the government will top up by 25%, up to a maximum of £3,000.
Founder and CEO of eMoov.co.uk, Russell Quirk, said: “Historically Help to Buy has been of little help to the nation’s aspiring homeowners and it is plain to see why when you look at the numbers.
“Although you must at least appreciate the government’s attempt at introducing a leg up through the ISA, the current pace of price growth across the market in England means that it will soon become irrelevant to the average buyer across nearly half of the country.
“The figures suggest that by March of next year, for those looking for government help to buy in London in particular, just nine of the capital’s 32 boroughs will be a viable option.
“Across England there are still plenty of areas available below £250,000 however, if you do need help to get on the ladder but would prefer to choose where you live rather than have it dictated by the government, the only option is to look further north or across borders to Wales and Scotland.”
The Help to Buy ISA scheme recently came under attack after it emerged that first-time buyers won’t be able to use the 25% bonus to fund a deposit for a house until the property has been purchased.
The Help to Buy ISA is due to end in 2019. Savers with a Help to Buy ISA will be able to transfer into the Lifetime ISA from April next year or continue saving into both – but you will only be able to use the bonus from one to buy a house.
The government has announced that Lifetime ISA savers will be allowed to put the bonus towards a deposit for their first home when they exchange contracts.
Loading ...