First time buyers may now only need to save £8,000 for a £200,000 home following the introduction of a new Help to Buy ISA.

One of the most challenging parts of buying your first home is saving for the deposit and research shows that over half of first time buyers need financial help from friends and family.  The position has been compounded, over recent years, as house prices have increased dramatically and as a consequence, the number of first time buyers has remained relatively low.

With the introduction of a new ISA bonuses coupled with existing homebuyer schemes that offer interest free loans, this could mean as little as £8,000 for a £200,000 property with a 5% deposit. With the new Help to Buy ISA, the Government will reward savings of £200 per month with a £50 bonus; therefore savings of £8,000 would be topped up by £2,000 to £10,000 through the scheme.

The new Help to Buy ISA will be available from banks and Building Societies from Autumn 2015 and savers will be able to open their account with as little as £1,000.