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Take stock: Lifetime ISA is good news for first-time buyers

PRIME minister Theresa May gave a keynote speech this week on the housing crisis, focusing on supply.

The challenge is price. The average deposit is £26,000 for a UK first-time buyer. It is nearly £100,000 in London. Home ownership is no longer an assumption. First-time buyers have had some help. Stamp duty has been removed for them on properties up to £300,000.

The new Lifetime ISA (Lisa) offers a way for first-timers to save up to £4,000 a year, and also lets them collect a 25% government bonus. There are also Help to Buy equity loans available, where government lends buyers up to 20% of the cost of a new home. It is 40% in London.

Look at Skipton for their cash Lisa; or Moneybox, Nutmeg, Hargreaves Lansdown or AJ Bell Youinvest for a stocks and shares version.

You may decide to keep on renting, topping up a workplace pension (remember the free contributions from your employer), or use a normal stocks and shares ISA to build an alternative source of future wealth.

Markets take a beating

DONALD Trump has been kicking off trade wars. He has proposed a 25% tax on steel imports and a 10% tax of aluminium imports. He has also threatened tariffs on EU-produced cars. This aims to make imports more expensive and promote the purchase of US products.

What does it mean for me? There are no easy wins in any trade wars. Retaliatory measures are common and this tit-for-tat approach pushes costs up for consumers. It is not liked by stock markets or businesses which believe in globalisation and free trade.

What’s next? The grievance is clear to understand. The manufacturing sector in the US has seen six million jobs disappear between 1999 and 2011. It’s easy to point the finger at China and their cheap exports which have flooded many countries, including the US. But all countries are feeling the pinch from automation as it cuts jobs. Trade wars tend to be bad news for consumer prices and global stock markets.

Going up

Inequality

RESEARCH for Sky News by the Office for National Statistics reveals details about how people’s wealth varies across Britain.

London has the highest proportion of households (21%) who have more than £1million of total wealth (including property equity and savings]. This means that over a fifth of households in the capital are technically millionaires. In the North East, only 8% of households have this much wealth.

Highlighting massive inequality in the capital, the poorest people in Britain also live in London.

The median total wealth of the bottom 10% of households in London is £19,000, compared with £57,000 in the South West and £63,000 in the South East.