ISAs 'ideal for people looking for first mortgage'

ISAs should be used by prospective first-time buyers, it has been said.

People planning to get on the property ladder by taking out their first mortgage need to take full advantage of the benefits offered to them by ISAs.

That is according to Matt Griffith, spokesman for PricedOut, who has called on prospective first-time buyers of residences to recognise how useful these savings accounts can be in helping them achieve their goal.

Mr Griffith explained that because of the efficiency they offer in terms of taxation, individuals attempting to set side the necessary capital for them to afford a deposit on an abode would be wise to make "full use" of their ISA allowance.

As of April this year, the government made it possible for consumers to store a maximum of £10,680 in these savings accounts without being subject to taxation, while this figure decreases to £5,340 for cash ISAs.

This could represent a sizeable proportion of any downpayment on a house, meaning they give individuals the ideal opportunity to set aside the necessary funds.

Indeed, the PricedOut official stated that using "chunks of saved money" is the only way many Britons will be able to buy a home in the near future as, in the aftermath of the global economic downturn, they cannot rely on interest payments from banks and building societies to do this.

"First-time buyers should also start asking their MPs why the UK has failed to provide cheaper housing for the younger generation," he added.

Last week (August 4th), the Countryside Alliance published research showing that local councils across Britain have failed to meet their provision targets for affordable housing by an average of more than 76 per cent over the last year.

And Mr Griffith went on to insist attitudes in the sector must change, as there is currently a huge shortfall in the number of affordable homes available in comparison to demand.

By Joe Letts