This creates a problem for those Lisa savers whose lives are based in these areas. They cannot use the account for buying their first property, so they have to withdraw their savings and are then hit with the 25 per cent penalty, which is distinctly unfair. Either that or they have to uproot their lives and move to a cheaper part of the country.
Our research has found that around 5.8mn 18 to 40-year-olds who currently do not have a Lisa would be more likely to invest in the account if the property price cap was removed. That is a lot of young people who could be saving for their first home.
So, what could the chancellor do to help first-time buyers during the Budget?
Just a few small tweaks to the Lisa could make a big difference according to our customers. Reduce the penalty to 20 per cent, so that any emergency dips into the savings pot means only the bonus is lost, and also take a look at the outdated house price cap.
These simple updates could enable the Lisa to be a critical tool in helping the next generation to move out of rented accommodation and into the stability of their own homes.
Jim Islam is chief executive of One Family, a Lisa provider
