If you use the Lifetime ISA to save for buying your first home, it must be:
Your Lifetime ISA must be open for at least 12 months before you can withdraw funds from it to buy your first home.
We wouldn’t recommend you do so. Due to scheme technicalities, the government bonus for the first year will only be paid after the end of the tax year (5th April 2018).
So, if you buy your home before then, and saved for your deposit through the Lifetime ISA, you wouldn’t receive the government bonus as you’d need to withdraw your savings before the bonus is applied.
The type of Lifetime ISA you choose will depend on your attitude to risk and reward.
However, as investments are for the longer term, if you plan to buy your first home within the three years you should probably open a cash Lifetime ISA.
If you’re planning to buy your first home in more than three years time, you may want to consider a stocks and shares Lifetime ISA. Investing in stocks and shares offers the possibility of better returns in the long run and could help you reach your goal faster. However, remember that your capital is at risk and the value of your investment can go down as well as up.
Yes you can, but the overall value of the house can’t exceed the £450,000 limit.
No. If you already own, or part-own, property anywhere else in the world you can’t use the Lifetime ISA to save for a deposit to buy property in the UK.
A Lifetime ISA may not be right for everyone
As with all investing, your capital is at risk. Tax rules may change in the future. If you are unsure if a Lifetime ISA is the right choice for you, please seek independent financial advice.