New deals on Help to Buy ISAs are set to be released paying up to 4% interest to customers hoping to save up for a deposit to purchase a home.
In his latest spending review, Osborne announced a flurry of updates to the Help to Buy scheme with a focus on properties in London, increasing the maximum salary of those eligible, and pledging some £4 billion to be spent on building 135,000 new shared ownership homes with a focus on those eligible for the newly reformed London Help to Buy scheme.
This was part of a general drive to increase levels of home ownership and to improve the housing market, particularly for younger people who are finding it harder and harder to get themselves on the property ladder.
Those who take out one of these new Help to Buy ISAs will have their savings topped by 25% by the government when they choose to withdraw the money to purchase a property. The government ‘s contribution will be capped at £3,000.
Building societies and banks are now announcing the deals they will offer on these new ISAs. NatWest and Nationwide will both pay interest at 2%, with Nationwide offering various extra perks on the side. Halifax are offering the current best deal, paying interest to customers at 4%. All of the rates however are variable, so are subject to change.
“It looks like the competition is now on to entice these new savers and to be seen as the first time buyer ‘s choice” said Charlotte Nelson from Moneyfacts.
In his Autumn Statement, Osborne also announced that he would be spending £7 billion on the construction of some 400,000 new affordable homes across the UK, beginning at the end of this parliament in 2019/20.