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  • FIRST POST
    • southlon86
    • By southlon86 4th Mar 18, 3:59 PM
    • 3Posts
    • 1Thanks
    southlon86
    HTB ISA or not!
    • #1
    • 4th Mar 18, 3:59 PM
    HTB ISA or not! 4th Mar 18 at 3:59 PM
    Hi, newbie here to forum!
    I am wrecking my brain trying to figure out which will be best.
    I would like to buy my own property one day and Help to Buy ISA looks great but only get bonus on property up to 450,000 which is very unlikely I am going to find on a 3bed in london, looking at shared ownership around 650,000 in my preferred areas so...

    A)Is there any point with opening a help to buy ISA
    B)Should I go for a split ISA lower interest but at least the help to buy option is there
    C)another type of saving but what

    I currently have an ISA I opened a few years back, not much in there and I use more like a easy access savings which is why I want an account strictly for saving towards a property

    and finally
    do I transfer money in old ISA to new before closing or close old ISA then put in elsewhere

    Hope this all makes sense and thanks for any advice!
Page 1
    • Alexland
    • By Alexland 4th Mar 18, 4:43 PM
    • 2,580 Posts
    • 1,958 Thanks
    Alexland
    • #2
    • 4th Mar 18, 4:43 PM
    • #2
    • 4th Mar 18, 4:43 PM
    At 650k the HTB ISA would only be worth having if you are getting a good rate.

    Without knowing how much cash you have or plan to accumulate it's hard to comment but many find that keeping cash savings outside ISA wrappers can be more advantageous.

    Alex
    Last edited by Alexland; 04-03-2018 at 7:10 PM.
    • Rich2808
    • By Rich2808 4th Mar 18, 6:06 PM
    • 615 Posts
    • 469 Thanks
    Rich2808
    • #3
    • 4th Mar 18, 6:06 PM
    • #3
    • 4th Mar 18, 6:06 PM
    I think your chances of buying a 3 bed in London for 450k are going to get challenging - bar possibly in Bexley, Havering and Barking and Dagenham.

    And bear in mind eligibility for using HTB isa for a shared ownership purchase is based not on the share you buy but the total market price - a policy which to me seems unfair but those are the rules.

    A lifetime isa would be more useful - as you get the 25% bonus even if you don't buy or buy a property over the 450k limit
    • Alexland
    • By Alexland 4th Mar 18, 6:15 PM
    • 2,580 Posts
    • 1,958 Thanks
    Alexland
    • #4
    • 4th Mar 18, 6:15 PM
    • #4
    • 4th Mar 18, 6:15 PM
    The LISA limit is 450k nationwide so you would need to pay a withdrawal penalty or wait until 60.
    • southlon86
    • By southlon86 4th Mar 18, 9:08 PM
    • 3 Posts
    • 1 Thanks
    southlon86
    • #5
    • 4th Mar 18, 9:08 PM
    • #5
    • 4th Mar 18, 9:08 PM
    Thank you Alex and Rich for your replies
    I have about 600 to start then will try to save 200 a month as per ISA allowance so just starting out but looking for right account.
    LISA also does not seem suitable as I wish to use before 60.
    • Alexland
    • By Alexland 4th Mar 18, 9:52 PM
    • 2,580 Posts
    • 1,958 Thanks
    Alexland
    • #6
    • 4th Mar 18, 9:52 PM
    • #6
    • 4th Mar 18, 9:52 PM
    600 then 200 per month are very small acorns to save for a deposit on a 650k property.

    Without meaning to be cruel is this a realistic ambition? Even saving a 5% deposit of 32.5k with an interest rate of 3% would take over 11 years by which time house prices might have increased again with inflation. And then you need to cover stamp duty, conveyancing expenses and demonstrate sufficient income to afford a mortgage on the other 95%.

    I am not an expert in how shared ownership might help but it seems a tough challenge.

    Alex.
    Last edited by Alexland; 04-03-2018 at 9:57 PM.
    • Rich2808
    • By Rich2808 5th Mar 18, 6:25 PM
    • 615 Posts
    • 469 Thanks
    Rich2808
    • #7
    • 5th Mar 18, 6:25 PM
    • #7
    • 5th Mar 18, 6:25 PM
    I just did a search on rightmove. There are nearly 6,000 houses on sale in Greater London for 450k or less - the help to buy and lifetime isa bonus limit.

    They are virtually all in the boroughs Havering, Hounslow, Sutton. Barking and Dagenham, Croydon, Bromley and Bexley though. So you are looking at zones 5-6 - but its still possible.

    Not the most glamorous parts of London - but there are nice areas where this is possible too.
    • southlon86
    • By southlon86 6th Mar 18, 11:36 AM
    • 3 Posts
    • 1 Thanks
    southlon86
    • #8
    • 6th Mar 18, 11:36 AM
    • #8
    • 6th Mar 18, 11:36 AM
    Property may not be 650k I was just using as an example of a property I have recently seen.
    I know I do not have much but id rather save than just not try.
    Its going to be tough I know!
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