Buying a home in Ireland has become increasingly difficult for first-time buyers. With property prices outpacing incomes, and mortgage limits tightening, many people are finding that their homeownership goals are drifting further out of reach. If this sounds familiar, you are not alone. Fortunately, government home support initiatives like the First Home Scheme are stepping in to bridge the gap.
The First Home Scheme Ireland is part of a broader effort by the Irish Government to make homeownership more achievable, particularly for those who can afford mortgage repayments but still fall short when it comes to qualifying for the full amount they need.
In this guide, we explore how the scheme works, who it’s for, and why this type of shared equity scheme for first-time buyers could be the key to unlocking your dream home.
Understanding Government Home Support in Ireland
Government home support in Ireland consists of several programmes aimed at helping individuals and families get on the property ladder. These include:
- The Help to Buy Scheme, which offers a tax refund to help with deposits
- The First Home Scheme, which provides direct financial support through shared equity
- Local authority schemes such as the Rebuilding Ireland Home Loan and affordable housing options
Each of these supports serves a different purpose, but all are intended to reduce financial barriers and increase access to new-build homes. Among these, the First Home Scheme is particularly significant for those whose mortgage approval falls short of the market price of available properties.
What Is the First Home Scheme?
The First Home Scheme Ireland is a government-backed shared equity scheme for first-time buyers. Introduced in 2022, its aim is simple: to help people who can afford mortgage repayments but cannot secure a mortgage large enough to buy a home.
The scheme allows the State (and potentially participating banks) to take a stake in your property, covering up to 30 percent of the price. In return, you agree to share a portion of your home’s equity with the government. There are no monthly repayments on this amount for the first five years, and you can buy out the government’s share at any time.
This is not a loan in the traditional sense. Rather, it’s a flexible financial partnership that enables more people to become homeowners without taking on excessive debt or being priced out of the market altogether.
How the First Home Scheme Works
The mechanics of this government home buying support Ireland are straightforward:
- Determine the Shortfall
If you have a mortgage approval and a deposit, but the total amount still falls short of the property price, the scheme can cover the difference. - Equity Share Provided
The State provides between 2.5 and 30 percent of the property price. This drops to a maximum of 20 percent if you’re also using the Help to Buy scheme. - No Immediate Repayment
For the first five years, there are no interest payments or repayments on the equity portion. - Buy Back the Equity When Ready
You can choose to buy back the government’s share at any time, either fully or partially. This is done at the current market value of the property. - Mandatory Repayment Events
The equity must be repaid when the property is sold, ownership is transferred, or if you refinance your mortgage.
This approach allows you to secure a suitable home now, even if your mortgage eligibility is lower than the purchase price.
Who Can Apply for the First Home Scheme?
To qualify for the scheme, you must meet the following requirements:
- Be a first-time buyer or meet the Fresh Start criteria (e.g. following separation or insolvency)
- Purchase a new build home in a private development
- Live in the home as your principal private residence
- Borrow at least 70 percent of the property price through a mortgage
- Fall short in terms of funding needed to complete the purchase
Additionally, the property must be priced within the regional price ceilings set by the scheme. These ceilings vary depending on the type of home and its location. For example:
- In the Greater Dublin Area, the ceiling is €475,000 for a house and €500,000 for an apartment
- In other counties, caps are lower, often ranging between €275,000 and €425,000
You must also use a participating lender and be approved for a mortgage before you apply for the scheme.
Example of How Government Home Support Works
Let’s say you’re buying a house in Cork for €330,000. You’ve secured a mortgage for €230,000 and have a deposit of €20,000. That still leaves a shortfall of €80,000.
Under the First Home Scheme, the government could step in to cover up to €66,000 (20 percent of the purchase price), assuming you’re also using the Help to Buy scheme. This support closes the affordability gap, allowing the sale to proceed without delay.
Key Advantages of the First Home Scheme
This government home support offers multiple benefits:
- Affordability: Enables access to homes previously out of financial reach
- No interest for five years: Reduces short-term financial pressure
- No repayments required during the interest-free period
- Flexibility: You can repay the government’s share when it suits you
- Combines well with other schemes such as Help to Buy
It also encourages greater home ownership in Ireland, reducing the long-term dependence on rental accommodation.
Things to Be Aware Of
Although the First Home Scheme is helpful, it is important to understand the responsibilities that come with it:
- The government owns a share in your property until it is fully repaid
- The value of the equity is based on current market value, which may rise over time
- After year five, a service charge applies to the equity amount unless you repay it
- Legal and valuation fees may be required when repurchasing the equity share
Before signing up, be sure to consult with a mortgage advisor or solicitor who understands the implications of shared equity agreements.
How to Apply for the First Home Scheme
Here’s a step-by-step on how to apply for First Home Scheme support:
- Get Mortgage Pre-Approval
You must have an approval in principle from a participating lender. - Check Regional Price Limits
Make sure the home you intend to purchase is within the scheme’s price cap for your area. - Create an Online Application
Visit the official First Home Scheme portal and set up an account. - Submit Required Documents
This includes proof of income, deposit, and your mortgage approval. - Review and Sign Legal Agreements
You’ll be issued a legal pack detailing the equity terms, which must be reviewed and signed before funding is released. - Complete the Purchase
The equity contribution is paid directly to the developer or solicitor on completion of the sale.
Final Thoughts: Is the First Home Scheme Right for You?
If you are a first-time buyer who can manage monthly repayments but needs help closing the affordability gap, the First Home Scheme could be the solution. This type of government home support makes homeownership more attainable without placing you under undue financial strain.
It is a long-term investment in your future and could provide the stability that renting simply cannot offer. Just be sure to understand the commitment involved and seek professional guidance before applying.
Ready to Take the Next Step?
Looking for new-build homes that qualify for the First Home Scheme? At FindQo.ie, we help first-time buyers connect with verified estate agents, access government support information, and start their journey towards owning a home in Ireland.
Visit FindQo.ie today and discover how government support can bring your new home within reach.
