LISA and a Roadmap to Home Ownership
In 2021 I opened my very own Lifetime ISA, abbreviated to LISA. Did I truly understand what I had opened at this point? Not as much as I do today.
At the end of 2020 I made the decision that I wanted to get off welfare, I’d take a salary from my business, topped-up with dividends from my Ltd company and make head way to saving and securing my very first home.
Unfortunately, the person I was with at the time did not share my enthusiasm for the project.
Regardless, I opened the account and added in just £11. It seems so small now, but that £11 was probably the hardest-fought over that I had ever had to acquire.
Seeing it go in, felt like a massive victory for me and my family, an experience I can relive to this day.
Those first pennies
It’s funny, looking back, those small amounts that first went into the account felt huge, they were massive steps towards a massive goal. The average price of a home back in 2021 was £275,000, I would need a deposit of somewhere between £20,000 and £27,000 if I wanted to be a home owner.
Yet the number for the deposit, and the amount needed for the actual home did not scare me into submission, it just made me more determined to go out and hit my numbers in business.
I set a date 2026, to be in my first home, I figured 5 years would be long enough to raise £20,000 at least, working it out at around £4,000 a year. I didn’t account for property values going up as much as they have.
If nothing else I figured, I could do surveys, sell advertising on my news website or anything legal that would bring in a few pounds a pennies.
Determination, focus and drive kept me going.
The reality check
Life has a bit of a tendency to throw some curve balls, and I got one hell of a curve ball.
Since then, things shifted, my life flipped upside down, the relationship I was in broke down and I ended up in a new line of work, working for mortgage and protection network. I also met someone new who is just as invested in buying our first home as I am.
The job I am in today has given me huge insight into the way mortgages work, has led me to a deeper understanding of how finance and money works and opened my eyes to the sheer volume of mortgage products that are out there in the market.
It is also what drove me to start studying for my CeMAP and start this blog.
Yet throughout all the trials and tribulations, I maintained one thing, contributions towards my own home. Even if it meant just £2 a week or £5 a month. It was something, and something was a down sight better than nothing.
House prices on the up
In 2025 the average cost of a house in the UK is £270,000 to £300,000 and this year the average UK house has actually broken through the £300,000 mark.
I have found myself, in recent months, asking, how can you keep up with such vast increases in values. To put the above figures into my model, I’d need a deposit of £27,000 to £30,000 to secure a home. This would give me a 10% share and the rest would be mortgaged.
So the options for a first time buyer:
- Shared Ownership: This is where some of the property is owned by you and the other is owned by a Housing Association or registered provider.
- Lower expectations: As first time buyers, you may need to reconsider the option of a new build and look at what is already out there in the market. It’s hard, believe me, and I am yet to actually settle for lower than what I believe can be achieved through work and focus.
- Keep Saving: I believe that everyone has a home out there for them, whether it’s a new build, shared ownership or a home that needs a bit of love. It is out there. Whilst the search continues, so does and should the saving. The more time you take to find your home the more money you can save, the larger the deposit, the smaller the mortgage and the lower your repayments will be.
A roadmap to home ownership
Look, I’m not a homeowner, not yet, it is still something I am saving heavily and working harder than ever for.
If you’re reading this and you are considering home ownership, don’t wait any longer. My major regret in all of this is I waited, I waited for approval rather than taking action. You need no ones approval to open your LISA, just make sure you’re 18+.
Take the action, open up your LISA, from one of the many great providers that are out there.
Somethings to consider:
- Paying in limit: There is a limit as to how much you can pay into your LISA, £4,000 a year and the government will give a 25% bonus on top. So max out your LISA payment amount and get the £1,000 extra.
- Age restrictions: You will need to open your LISA before your 40th birthday. If you’re over the age of 40 then you can continue paying into your LISA until your 50th birthday, once reached, no additional payments can be made.
- Penalty: The LISA is strictly for buying your first home (or retirement). You can withdraw money for other reasons, but you will face a 25% withdrawal charge. Because this charge is calculated on the total pot (your money + the bonus), you will actually get back less than you originally put in. My advice? Pay in and treat it like a locked vault.
- Perfect for FTB’s: As a first time buyer, the LISA is designed for you. However, if you already owned a property before whether that’s in the UK or abroad, you cannot use a LISA for a home purchase
- £450k: The property must be under the £450,000 mark.
I am on a mission to buy my very first home, whilst studying for a Certification in Mortgage Advice & Practice. I am undoing 13 years of financial neglect and on a steep learning curve as a result. Subscribe to my weekly newsletter to keep up to date with all the developments.