Written evidence submitted by Anonymous

I’m writing in response to the inquiry into the LISA scheme, following questions about its efficacy and future, having been introduced back in 2016.

Number one, I don’t believe the LISA should be abolished at all. It has been a life changing scheme for tens of thousands, if not hundreds of thousands of people. For myself and my family, it will allow us to make good progress towards home ownership in the middle of the worst housing crisis in modern history.

With regards to fees, I personally support the fees for removing investments early. I believe it to be a powerful incentive not to extract savings. Yet, if the savings are extracted the overall impact isn’t massive as a percentage. This is coming from somebody who did extract cash from my LISA to avoid wedding debt as a conscious, financial decision.

In terms of the maximum house price, I personally couldn’t see myself buying a home over £450,000 but I can see the issues if you live down south.

The maximum annual contribution is a factor that concerns me. £4000 hasn’t changed since 2016 and as a result, the real-term investment is now lower. I do appreciate that couples can both use a LISA, this helps dramatically but causes issues when a future homeowner is trying to utilise the LISA bonus but wants to buy a property sooner. For example, my wife and I want to save while she is at uni. Our total savings will barely max-out a single LISA each year. Whereas when she graduates, we’ll be able to save much more. The issue being that at that point, our potential savings will be in excess of the LISA. Waiting year after year to contribute and generate the bonus will quickly be offset by the increase in home values and subsequently the required deposits.

January 2025