Buying a house of one’s own is something which many people may well strive to do – be that for financial reasons or for the comfort of being able to decorate the property as desired. For some, it may be that saving for a mortgage deposit is done with the help of a Lifetime ISA. The savings option first launched onto the savings scene in April 2017.
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Skipton Building Society, a LISA provider, has revealed it has seen a 215 percent increase in the amount of homes bought using Skipton’s LISA from 2018 to 2019.
Last year, 11,381 houses were bought with Skipton’s LISA, up from 3,641 in 2018 and 15,255 to date.
Amy Bunney, 27, and her boyfriend were set on getting their own place – but the first-time buyers wanted to take the investment one step further.
Rather than aiming to purchase one property together, they have made it their mission to purchase two.
Amy, from Skipton, has shared her experience of saving for her goal exclusively with Express.co.uk.
The assistant campaign manager first began doubling down on her savings from the age of 20, and has since managed to accumulate a £35,000 deposit.
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Mortgage UK: Some people may use a Lifetime ISA to boost their mortgage deposit (Image: GETTY)
Mortgage: Amy Bunney and her boyfriend both saved money in their own Lifetime ISAs (Image: AMY BUNNEY)
Aware of the Lifetime ISA (LISA), which offers a 25 percent bonus from the government on savings up to £4,000, since its commencement back in April 2017, Amy saved £17,000 into a LISA as soon as the account became available – enabling her to boost savings by 25 percent.
Having amassed the amount she needed for her mortgage deposit, Amy set her eyes on a two-bedroom property with a garden and two parking spaces, situated in a village near Skipton.
She bought the home in need of renovation, and Amy and her boyfriend are now making the final DIY touches necessary. Meanwhile, Amy’s boyfriend is saving up enough money for his own separate property using his own Lifetime ISA – with a view to go on to rent the latter home out.
“The property was originally advertised at £165,000, however we were able to negotiate down to £152,000,” Amy explained.
“This was still at the top end of my budget though. Fortunately, the house needed a lot of renovation, which brought the price down, and my boyfriend works in construction so we saved a lot of money when it came to making the home improvements.”
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At the time of buying, around six months ago, Amy’s salary was £23,000.
The government bonus from her Lifetime ISA savings totalled £3,000, which she combined with her other savings to reach her total.
Prior to purchasing, the couple had been living separately with their parents, allowing them to save up more money.
“We did the renovation work on the property whilst still living at home and now it’s almost ready to move in.”
Saving up tens of thousands in one’s 20s is no mean feat, and Amy has explained how she went about reaching her goal.
“I have been saving all my life. I started putting money away during my A-Levels, but I really started ramping-up my savings when I was about 20.
“I was at art college in Leeds then, and since, have put aside around £500 per month.
Mortgage: Amy bought the house and has since carried out renovation work (Image: AMY BUNNEY)
Mortgage UK: Man uses Lifetime ISA interest to buy home
“Throughout, I’ve always tried to ensure that I’ve maxed out my Lifetime Isa, to get the biggest bonus.”
Amy went on to reveal the savings tips which had been of help to her.
“My most valuable tool for saving has been spreadsheets,” she explained. “These have helped me budget and calculate how much I’m saving per month.
“I’ve also tried to cut back on non-essentials, such as buying lunch and snacks at work, choosing instead to make pack-ups. I’ve also tried to reduce the amount I spend on clothes.”
Another way in which she reached her goal was with the help of friends and their decision to cut costs on socialising by dining in at home instead.
“My friends and I have also tried to work together to save on money – for instance by having meals at each other’s houses, rather than going out for dinner,” she recalled.
“When it came to homebuying, I was regularly monitoring RightMove and OnTheMarket alerts to ensure I was able to view homes from as soon as they were available.
Mortgage: Amy has shared her experience of saving after boosting hers with a Lifetime ISA (Image: AMY BUNNEY)
Mortgage: Amy bought the house for £152,000, after negotiating down the price (Image: AMY BUNNEY)
“There is also a great tool called the ‘Affordability Calculator’, which I used to estimate how much I needed in savings.”
Reflecting on her experience, Amy suggested that other young couples saving for their first home “understand that it is possible to have balance in your life”.
“I was still able to save, without having to give-up all luxuries. You can compromise in smart ways,” she said.
Another thing fellow savers may want to watch out for is covering additional costs when purchasing the property – something which Amy discovered the hard way.
“We didn’t factor in the cost of estate agency fees or surveying during the buying process,” she explained.
“I was fortunate enough that my parents were able to pay this part of the sum, leaving me £2,000 spare to spend on decorating and renovating the house.
“I’d suggest that anyone looking to buy has at least £5,000 spare for this, on top of a deposit, when budgeting.”