More than a million have opened flagship home buying savings product in UK

More than one million Help to Buy ISAs have now been opened since it was launched in 2015, helping first time buyers across the UK save towards their first home, the latest official figures show.

It means that first time buyers have saved over £1.8 billion in their ISAs and Economic Secretary to the Treasury, Stephen Barclay, said it is proof that the product is a success.

‘Our Help to Buy schemes continue to prove hugely popular across the country, as we support people to get on in life and achieve their dream of climbing the housing ladder,’ he added.

The Government’s Help to Buy: ISA scheme was launched on 01 December 2015 to provide first time buyers with the opportunity to save up to £200 a month with the Government topping up their contributions by 25%, up to a maximum of £3,000.

First time house buyers across the UK can open an ISA, which is available for home purchases up to £250,000 or £450,000 in London. If a person plans to buy a home with someone who also qualifies, they are each able to separately claim the bonuses on their savings and put both towards the home buying process.

The scheme has proven to be hugely popular, with the equivalent of 1,500 Help to Buy: ISAs being opened every day since its introduction. The number of providers of the scheme, which includes banks, building societies and credit unions, has doubled since its launch to 28, with the Nottingham Building Society being the most recent to sign up.

Savings in a Help to Buy: ISA are tax free and are also quick and easy to open. Savers can receive on average 2.4% interest rate on their savings which is typically higher than an instant access savings account.

First time buyers will be able to open a Help to buy ISA until 30 November 2019. Existing account holders can continue to save in their ISA account until 30 November 2029 when accounts will close to additional contributions. Bonuses can be claimed until 01 December 2030.