Help to Buy ISA

greensmoker

Hello,
My daughter (age 16) has a Help to Buy ISA that she and we contribute to.
She would like to purchase a property at age 18 with the intention to live it in.
Does she have to live in the property immediately or can she rent out the property for a few years whilst she lives with us and finishes her studies?
So her long term intention is to live in the property but for the short term, she would rent it out.
Is she allowed to use her Help to Buy ISA in this situation?
Thanks

diggingdude

No she needs to move in this is not a taxpayer bonus to become a landlord.

Catkei

At that age I don't get the huge rush? Can she not wait to buy when she is actually ready to move out? Also I don't get how she's supposed to get a mortgage with no or little income as a student.

bopsybunny

The terms of the government bonus are that it must be used towards the purchase of your only home, which cannot be rented out or used as a holiday home. If she wants to buy a house and rent it out, she could not claim the bonus. She would also need a buy-to-let mortgage.

Exodi

https://www.helptobuy.gov.uk/help-to-buy-isa/who-is-eligible/ wrote:

To qualify for the government bonus, the property you are buying must:

be in the UK

have a purchase price of up to £250,000 (or up to £450,000 in London)

be the only home you will own

be where you intend on living

be purchased with a mortgage

There's also the issue that you'd need consent to lease from the mortgage lender. I think you stand close to zero chance getting this at the start of the mortgage, especially as a first time buyer.

I'm also somewhat dubious that it is your 16 year old daughter asking about this. Most 16 year olds I know are drinking in parks and crying over two week relationships ending, not formulating ways to exploit government incentive schemes...

wjr4

Does she really want the stress of being a landlord at age 18?

gingercordial

How is she going to apply for a mortgage - what income does she have?

If it is actually you applying for the mortgage (alone or with her) then presumably you will be on the deeds (unlikely you can avoid this) therefore this will not be a first time buyer purchase and you will be paying additional rate stamp duty as this will be your second property.

Apart from that it's also not a great idea at this point in her life. How does she know where she will be able to get a job after university and therefore where she will want to live?