Help-to-Buy Isas: the new way to give your child a leg up on the property ladder

Paying into a Help-to-Buy Isa could give a first-time buyer a sizeable sum towards the deposit on their first house.

UK property prices are continuing to shoot up, especially in London, and complaints that it's impossible for first-time buyers to get onto the property ladder are hard for politicians to ignore. So the government has launched a number of schemes, such as Help to Buy and Shared Ownership, which are supposed to make it easier to get a mortgage for a property. The latest is the Help-to-Buy Isa, which became available in December 2015, and is intended to give first-time buyers some help in saving up enough money for an initial deposit.

The Help-to Buy-Isa is effectively a cash Isa, with some special rules and a potential bonus from the government. The idea is that you make an initial deposit of up to £1,000 and can put in up to £200 more each month. If you accumulate at least £1,600, the government will give you a bonus on the total amount of up to 25%. The maximum top-up is £3,000, so if you accumulate more than £12,000 you won't get any additional bonus.

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri