Last weekend saw the opening of the one millionth Help to Buy ISA, showing the enduring popularity of this type of Government-backed savings account for those looking to take their first step onto the property ladder.
This means that since their launch at the end of 2015, the equivalent of 1,500 Help to Buy ISAs have been opened every single day. This has resulted in savings of more than £1.8 billion to be used for buying that all-important first home, HM Treasury has revealed.
The way the Help to Buy ISA works is that savers can put away £200 per month, protected by the general tax-free nature of ISAs, in an account of their choosing. And with 28 providers now offering Help to Buy ISAs, double what they started at, there should be plenty of choice.
Once you've saved enough in your chosen account, and you're ready to buy that first home, the Government will top up your funds by 25% (up to a maximum of £3,000), which will go directly towards your new home (worth up to £250,000 or £450,000 in London). This could make all the difference when you're saving up, especially given the ever-increasing cost of buying property.
If you're struggling to build up your deposit for a first home, a Help to Buy ISA is certainly worth considering. With an average interest rate of 2.4%, it may not be able to beat inflation, but it could be higher than the rate you may be able to get on standard savings accounts, so it would be worth comparing different accounts to see which works best for you.
What's more, the Government top-up means that a Help to Buy ISA could work out as better value for money than a similar account with a slightly higher rate which does not have such a bonus. Especially if you and your partner both open a Help to Buy ISA, you could get a bonus of £3,000 each to put towards your first home.
Just keep in mind that you will only be able to open a Help to Buy ISA until 30 November 2019, and you will only be able to claim the bonus until 1 December 2030, so don't wait too long to take advantage of the scheme.
Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.