Approximately two-thirds of people who have used the State’s First Home Scheme to purchase a property also availed of the Help to Buy Scheme tax rebate, new figures show.
The finding has prompted criticism that first-time buyers now require two State subsidies to buy a home in the Republic.
According to the First Home Scheme’s operator, 801 of the 1,231 buyers who availed of the scheme in the first 10 months of this year (65 per cent) were simultaneously in receipt of the Government’s help-to-buy rebate.
In 2024, this figure was even higher, with 67 per cent of the 1,800 successful first-home applicants also availing of help to buy. That percentage was the same in 2023, while in 2022, the year the scheme commenced, it was 58 per cent.
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To bridge the affordability gap, the First Home Scheme allows the State to fund up to 30 per cent of the price of the home for first-time buyers in return for a minority equity stake in the property.
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Recent figures show that some 8,400 potential buyers have been approved for the scheme since it was launched in July 2022, with the average financial support put at €66,000.
The Government’s Help to Buy Scheme allows potential buyers tax rebates of up to €30,000 from income taxes and Dirt paid in the preceding four years to set against the cost of new-build homes under €500,000.
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“The fact [that] more than 60 per cent of homebuyers who access the First Home Scheme also need use the Help to Buy Scheme shows just how expensive new homes are,” said Sinn Féin housing spokesman Eoin Ó Broin, who requested the figures from first home.
“It also clearly sends a price signal to developers that the purchasing power of their potential buyers is significantly increased,” he said. “This pushes house prices up.”
Mr Ó Broin said the Government was now allowing potential buyers to combine the two subsidies with a third – Croí Cónaithe Cities – through which the State provides a grant [up] to the value of €140,000 for apartment purchases, he said.
“This is not only a huge level of taxpayer subsidy, it is incredibly inflationary, making it more difficult for first-time buyers to purchase their own home,” he added.
“This is money that would be much better spent in the delivery of genuinely affordable homes for working people to purchase at significantly lower prices,” said Mr Ó Broin.
Minister for Housing James Browne has defended the use of the scheme, describing it as a “key part” of the Coalition’s efforts to address housing affordability.
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In May this year, Mr Browne announced an additional €30 million in funding for the scheme and a two-year extension to at least 2027. “For many, this scheme has been essential in turning home ownership from a hope into a reality,” he said.
Reports from banking lobby group Banking and Payments Federation Ireland, published last month, show first-time buyers, many using these schemes, accounted for nearly two-thirds of new mortgages drawn down in the last 12 months.
The Government’s new housing plan – Delivering Homes, Building Communities – aims to deliver 90,000 “starter homes” over the next five years.
