First-time buyers are unimpressed by the Government’s Help to Buy Isa initiative with almost half expected to shun the plan.
That is despite the fact they get a potential windfall of up to £3,000 by joining the scheme after it launches on 1 December, according to new research by Money.co.uk.
Almost four out of five would-be first-time buyers think Help to Buy Isas are a good idea but 45% do not plan to take the offer of a free cash bonus
One in three say they have already paid into their cash Isa this year, a similar number are put off by the plethora of terms and conditions including limitations on how the money is withdrawn and spent, while 13% do not trust the government to pay the bonus.
Almost seven out of 10 were unaware that you cannot pay into one of these accounts alongside a standard cash Isa.
Half of those who plan to open account said the bonus is better than other interest rates available and a similar percentage think it is a generous offer.
Hannah Maundrell, editor-in-chief of Money.co.uk, said: “Help to Buy ISAs aren’t the silver bullet that will shoot wannabe first time buyers onto the property ladder, but the free cash will certainly give them a step up.
“Anyone that’s even contemplating buying a property should think about getting one, not least because the interest rates are likely to be competitive.”
Maundrell warned that banks and building societies will use Help to Buy ISAs as an opportunity to cross-sell mortgages and other financial products.
“A mortgage is a long and expensive commitment and while your existing bank might seem like the easy option, it doesn’t mean it is the best one. In all likelihood it won’t be.”