How does the Help to Buy ISA work?
The Help to Buy ISA allowed first-time buyers to save up to £200 per month, with an initial deposit of up to £1,200 when opening the account. The government added a 25% bonus on the savings, meaning for every £200 saved you received an extra £50.
The maximum bonus is £3,000, which requires savings of £12,000. You must have saved at least £1,600 to claim the minimum bonus of £400. The bonus is claimed through your solicitor at the point of purchase, not before.
Key deadlines for existing account holders
Although the Help to Buy ISA closed to new applicants in November 2019, existing account holders can continue to save into their account until November 2029. The bonus must be claimed by November 2030, giving you a one-year window after the savings deadline.
If you do not use your Help to Buy ISA savings for a property purchase, you can still withdraw the money but you will not receive the government bonus. It is important to plan your purchase timeline around these deadlines if you want to benefit from the scheme. Our borrowing calculator can help you understand how much deposit you need.
Property price limits
The Help to Buy ISA bonus can only be used on properties costing up to £250,000 outside London or up to £450,000 in London. If the property you want to buy exceeds these limits, you cannot claim the bonus, though you can still use your ISA savings.
These limits have not changed since the scheme launched in 2015 and do not increase with inflation. In areas where house prices have risen significantly, some buyers find that properties now exceed the cap even though they would have been eligible when they started saving.