Property expert Simon Morris recently commented that the Help to Buy ISA will be attractive to property investors following the Conservative victory in the 2015 UK national elections.
Help to Buy ISA
UK Chancellor George Osborn used his final budget before the 2015 election to announce the creation of the Help to Buy ISA. He revealed that the financial product would be launched in April 2015.
The new ISA wrapper would allow first-time buyers on the property ladder to recover £200 per month from the taxman. This is because the government promised to provide savers with 25p for every £1 stored in a Help to Buy ISA. The account requires a minimum input of £1,000 and provides maximum earnings of £3,000 for £12,000 stored in the ISA.
Significance of Tory victory
Many financial experts doubted whether the Conservatives would have the chance to implement the Help to Buy ISA. As property specialist Simon Morris was recently quoted saying by Property Investor Today: “Every poll suggested that there’d be no clear winner on 7th May and the strong surge of the SNP in Scotland indicated that Cameron’s Conservatives might have been locked out of the halls of power all together in favour of a Labour-SNP coalition.”
Morris also noted that the Tories’ surprise victory, even if it was tight, has given them the mandate they need to implement their plans for the UK property market. He said: “In the run up to the national poll the Tories outlined a number of policies designed to boost the UK’s residential sector including intentions to build 200,000 starter homes in England by 2020 and the Help to Buy ISA.”
He went on to comment: “The Help to Buy ISA in particular has the potential to make the UK’s residential sector a more attractive property investment option. The fact that it’s designed to help people save will persuade more first time buyers to purchase a home and inject capital into the market.”
Investors should research financial products
Speaking further about the Help to Buy ISA, Simon noted that he believes it offers a profitable investment opportunity when property funds and bonds are used within it. This allows investors to capitalise on tax advantages.
He said that “I would recommend that investors research any potential in-direct property investment option and choose a regulated product before they commit if they want to reap healthy returns.” Morris concluded by commenting that “investors should also use the services of an Independent Financial Advisor where property investment products are concerned. An IFA will weigh up their appetite for risk against their expectations concerning yield to show them the right financial product for their circumstances.”