The deposit is the hard part

For most first time buyers in Ireland, saving the deposit is the biggest obstacle, not the monthly repayment. The Central Bank rules let first time buyers borrow up to four times their gross income, so the rest has to come from savings, gifts or a State scheme. Two schemes matter most: Help to Buy and the First Home Scheme.

Help to Buy

Help to Buy is an income tax refund for people buying or building a new home. You can claim back the income tax and DIRT you paid in the previous four tax years, up to a limit of €30,000 or 10% of the purchase price, whichever is lower.

Key points:

  • It applies to new builds, self builds and, for some, a vacant property converted to a home.
  • You must be a first time buyer and take out a mortgage.
  • The home must be your main residence for at least five years.
  • The refund is limited by the tax you actually paid. If you have paid €9,000 in income tax and DIRT over four years, that is the most you can claim, even if 10% of the price is higher.

Apply through Revenue myAccount before you sign the contract, and the refund goes to your builder or solicitor as part of the deposit.

First Home Scheme

The First Home Scheme is a shared equity scheme. The State and participating banks take an equity stake in your home, and in return you need a smaller mortgage and deposit. The stake you take on is a percentage of the property price, and there are limits that depend on the county or city and the price.

Key points:

  • You do not pay rent on the State's share.
  • You can buy the stake back at any time, in whole or in part.
  • The cost of the stake can rise after the first five years, so you need to plan how and when to repay it.
  • It is open to buyers of new builds and in many cases second hand homes, within price limits.

Using both together

Many buyers can combine them. Help to Buy supplies cash for the deposit, and the First Home Scheme can reduce the mortgage you must borrow. Check the current rules for each scheme before you commit, because the price ceilings and eligibility change.

A simple budget

Say you earn €60,000 and want to buy a €350,000 new build:

  • Maximum mortgage at 4 times income is €240,000.
  • That leaves €110,000 to find from deposit and other sources.
  • A Help to Buy refund of up to €30,000 and savings can cover part of that, and the First Home Scheme can cover the rest in many cases.

This is a simplified example. Lenders look at your whole financial picture, including debts and spending.

Before you apply

  • Get mortgage approval in principle first, as it tells you what you can actually borrow.
  • Keep three years of tax records to hand.
  • Ask your solicitor to confirm the scheme requirements before you sign.
  • Budget for stamp duty, legal fees and a valuation, which are not covered by either scheme.

The short version

If you are buying a new build, Help to Buy is usually the first thing to claim. The First Home Scheme can then bridge what is left. Use our mortgage calculator to test what repayments look like at different loan sizes.

A second example: a couple buying together

Two partners earn a combined €85,000 and want a €400,000 new build.

  • Four times combined income gives a maximum mortgage of €340,000.
  • First time buyers need at least a 10% deposit, which is €40,000 on this price.
  • A 90% mortgage would be €360,000, which is €20,000 more than the income rule allows.

They can close that gap in a few ways: more savings, a Help to Buy refund of up to €30,000 towards the deposit, or First Home Scheme equity to reduce the loan they need. Each option has a cost or a condition, so they should ask a broker to show the monthly repayments for each combination before choosing.

Questions people ask

Can I use Help to Buy for a second hand house? Generally not. It is for new builds and self builds, with some limited exceptions for vacant properties turned into homes.

What if I paid very little tax? The refund is limited to the income tax and DIRT you actually paid in the previous four years. Self employed people can use their own tax history in the same way.

Do I have to repay the First Home Scheme stake? Not by a set date, but the cost of the stake rises after five years, so many buyers plan to repay part of it earlier.

Is a joint application possible? Yes. Couples buying together can both apply, and the limits are set per application.

Do I still need a 10% deposit with these schemes? Yes. Help to Buy counts towards the deposit, and the First Home Scheme reduces the mortgage you need, but the lender's deposit rules still apply.

Can I use a gift from family? Many lenders accept a gift towards the deposit, usually with a letter confirming it does not need to be repaid. Ask your lender what documents it wants.