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What is the First Home Shared Equity Scheme?

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First Home shared Equity scheme

The dream of owning a house was put on hold for many people throughout the years. Rising prices , scarcity of houses , the struggle to pay high rent while at the same time save for a deposit. Furthermore the Central Bank macroprudential rules requires first-time buyers to save at least a cash deposit equivalent to 10% of the value of the home they want to buy, while mortgage borrowing is capped at 3.5x their combined gross annual income. But the good news is there is light at the end of the tunnel. From 7 July, the Government of Ireland’s Housing for All housing policy now offers its ‘First Home’ Shared Equity Scheme to open up the housing market to first-time buyers, giving support through different financial options to get them started. Not just couples but individuals too can apply for the scheme, and while a 10% minimum deposit is required, this
may include contribution from the Help to Buy scheme.

What is the First Home Scheme?

First Home, a new shared equity scheme for first-time buyers that is expected to fund the purchase of up to 8,000 homes over four years.

Under the scheme, part of the purchase price will be provided to buyers to add to their deposit and mortgage, with the state paying up to 30% of the cost of the new home in return for an equivalent stake in the property.

How will it help First home shared equity scheme work for homebuyers?

Through the scheme, the support provided will take the form of a percentage equity stake (share of the ownership) in the home equal to the difference between the open market value of the property and the price paid by the purchaser.

How does the First Home Shared Equity Scheme work?

The scheme aims to help people secure a home by providing part of the purchase price of the dwelling in return for a minority equity stake. The scheme is open to first-time buyers of newly built houses and apartments. The scheme is open to first-time buyers of newly built houses and apartments

If, for example, the cost of building your new home is €320,000, and you have a 10% deposit
and a household income of €70,000 but your approved mortgage amount falls short at
€245,000, the Shared Equity Scheme will bridge the €43,000 gap. All you need to do is apply
for the ‘First Home’ Shared Equity Scheme when you apply for a mortgage.
For full details on this and to learn all the ways the Government is planning to solve the
housing crisis (from helping people out of homelessness and supporting low-income families
to amending the ‘Fair Deal’ scheme), go to

Do you have to pay interest and capital repayments on the equity loan?

During years 0-5, no interest is payable on the loan. From years six to 15, an interest rate, described as a service charge, of 1.75% will apply. From years 16 to 29 an interest rate of 2.15% will apply. Unlike a typical mortgage however, the repayments are interest only, i.e no capital repayments are required. 

Home owners will have the option of paying this charge each year or deferring the payment until the property is sold

How will the First Home Scheme impact the housing market?

The First Home Scheme will provide a means for many first time buyers to get a step on the property ladder. There will be increased demand for new homes as the scheme only applies to new builds. Will this drive up the price of new builds? Will the supply of new builds be able to keep up with demand? The first home scheme is certainly a welcome move by the government to help first time buyers. But should it really be limited to new builds? Just imagine if this scheme were to be extended to the second hand market. Would it not create a more balanced market? not to mind to mention helping Ireland make use of derelict properties


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