The First Home Scheme bridges the deposit gap for buyers who can afford a mortgage but struggle to save the full deposit. Since launching in July 2022, it has helped thousands of Irish buyers purchase new-build homes with equity funding from the government.
This guide explains exactly how much you can receive, how the calculation works, and what happens when you eventually sell or refinance.
What Is the First Home Scheme?
The First Home Scheme is an equity loan from the state. The government takes a stake in your new home (between 20% and 30% of the purchase price) and you repay this when you sell, refinance, or after a fixed term.
Unlike a traditional loan, there are no monthly repayments on the government equity. You only repay when a trigger event occurs—usually sale or remortgage—and the amount you repay reflects the property’s value at that point, not the original loan.
This is not a grant. If your home increases in value, the government shares in that gain. If it falls, they share in the loss.
Maximum Equity You Can Receive
The scheme provides:
- 30% equity for first-time buyers
- 20% equity for former homeowners (Fresh Start applicants who have lost a property to repossession or relationship breakdown)
Both are capped at a maximum of €90,000.
For most purchases, the percentage limit applies before the cash cap. A first-time buyer purchasing at €300,000 would receive 30% equity (€90,000). At €350,000, they still receive 30%—but that would be €105,000, so the €90,000 cap applies instead.
Price Caps by County
Your purchase price cannot exceed the following limits:
| County | Maximum Purchase Price |
|---|---|
| Cork and Dublin | €500,000 |
| All other counties | €450,000 |
These caps apply to the total purchase price, not just the portion you’re financing. If you’re buying a €480,000 home in Dublin with 30% equity support, the breakdown is:
- Government equity: €90,000 (capped)
- Your deposit (10%): €48,000
- Mortgage (≈60%): €342,000
The price caps reflect regional differences in new-build costs. They are separate from Central Bank loan-to-income limits, which still apply to your mortgage portion.
Income Limits
Your gross annual income must be below these thresholds:
| Region | Single Applicant | Joint Applicants |
|---|---|---|
| Cork and Dublin | €65,000 | €90,000 |
| All other counties | €60,000 | €80,000 |
“Gross income” means your salary before tax, including:
- Basic salary
- Regular bonuses and commission (averaged over two years)
- Overtime (if consistent)
- Rental income (if you own investment property)
It does not include:
- Child benefit
- One-off bonuses
- Income from side work if you’re not registered as self-employed
Joint applicants combine their incomes. Two applicants earning €45,000 each (€90,000 total) would qualify in Dublin or Cork but exceed the limit elsewhere.
Income is assessed at application stage. If you expect a pay rise before closing, it does not disqualify you—the figure used is your income when you apply.
Calculating Your First Home Scheme Amount
The formula is straightforward:
Government equity = purchase price × percentage (capped at €90,000)
Example 1: First-time buyer in Galway
- Purchase price: €350,000
- Equity percentage: 30%
- Calculation: €350,000 × 0.30 = €105,000
- Actual equity: €90,000 (capped)
You need:
- €35,000 deposit (10%)
- €225,000 mortgage (approved by lender)
- €90,000 government equity
Example 2: First-time buyer in Dublin
- Purchase price: €400,000
- Equity percentage: 30%
- Calculation: €400,000 × 0.30 = €120,000
- Actual equity: €90,000 (capped)
You need:
- €40,000 deposit (10%)
- €270,000 mortgage
- €90,000 government equity
Example 3: Fresh Start buyer in Limerick
- Purchase price: €320,000
- Equity percentage: 20% (not first-time buyer)
- Calculation: €320,000 × 0.20 = €64,000
- Actual equity: €64,000
You need:
- €32,000 deposit (10%)
- €224,000 mortgage
- €64,000 government equity
The 10% Deposit Requirement
You must have a minimum 10% deposit saved. This is separate from the government equity. Using borrowed funds for your deposit (e.g., a personal loan or credit card) disqualifies you.
Acceptable deposit sources:
- Savings
- Gift from family (with a signed letter confirming it’s a gift, not a loan)
- Sale proceeds from another property (for Fresh Start applicants)
The deposit can come from a Help to Buy refund. If you’ve paid income tax in the previous four years, you can claim a tax rebate of up to €30,000 (10% of purchase price, capped) towards your deposit. This stacks with the First Home Scheme.
Mortgage Approval First
You need mortgage approval in principle before applying for the scheme. The lender assesses your income and decides how much they will lend you. The First Home Scheme does not increase your borrowing capacity—it reduces the mortgage you need.
Central Bank rules still apply:
- First-time buyers can borrow up to 4× joint income (some lenders allow 4.5× for part of the loan)
- You need a 10% deposit (the government equity does not count as your deposit)
If your income is €70,000 (joint), you can borrow around €280,000–€315,000. With a €90,000 equity loan and €40,000 deposit, you could purchase up to approximately €430,000–€445,000. The exact figure depends on your lender’s assessment.
What Properties Qualify?
The scheme applies only to newly built homes purchased from a builder or developer. You cannot use it for:
- Second-hand properties
- Self-builds (unless purchased from a developer as a completed unit)
- Buy-to-let investments
The property must be your primary residence. You commit to living there for at least five years. Renting out a room under the Rent-a-Room scheme (up to €14,000 per year tax-free) is allowed.
When and How You Repay the Equity
You repay the government equity when:
- You sell the property
- You remortgage or refinance to buy out the equity stake
- After 30 years (even if you haven’t sold)
The repayment amount is based on the property’s market value at the time, not the original purchase price.
Repayment formula
Repayment = (equity percentage) × current market value
If you received 30% equity on a €350,000 purchase (€90,000), and you sell 10 years later when the property is worth €450,000, you repay:
€450,000 × 0.30 = €135,000
If the property falls to €320,000, you repay:
€320,000 × 0.30 = €96,000
The equity stake percentage is fixed. The cash amount varies with the property’s value.
Early repayment option
You can buy out the government stake at any time if you can afford to refinance. Most buyers do this when:
- Interest rates drop and remortgaging becomes attractive
- Their income increases and they can borrow more
- They inherit money or receive a windfall
There is no early repayment penalty. The repayment amount is still based on current market value, so you may pay more or less than the original €90,000 depending on price movements.
Interaction with Help to Buy
You can combine the First Home Scheme with Help to Buy. Both schemes target new builds, and both have income caps, but they serve different purposes:
- Help to Buy refunds income tax (up to €30,000) to increase your deposit
- First Home Scheme provides equity so you need a smaller mortgage
If you qualify for both:
- Claim Help to Buy first to maximize your deposit
- Apply for the First Home Scheme to reduce your mortgage requirement
A buyer purchasing at €400,000 with both schemes could structure it as:
- €40,000 deposit (10%), of which €30,000 is from Help to Buy refund
- €270,000 mortgage
- €90,000 government equity
You need to have earned enough over four years to claim the full Help to Buy amount. If you’ve only paid €18,000 in income tax, that’s the maximum refund—you can’t claim €30,000.
Who Qualifies for the Scheme?
You qualify as a first-time buyer if:
- You have never owned a home in Ireland or abroad
- You are not a beneficiary under a trust that owns property
- You do not hold a life interest in a property
Fresh Start applicants qualify if they previously owned a home but lost it due to:
- Repossession
- Voluntary surrender to a lender
- Court-ordered sale following relationship breakdown
Fresh Start buyers receive 20% equity (not 30%) and must meet all other criteria. If you sold a property voluntarily because you wanted to move, you are not eligible—this route is specifically for financial distress or family law circumstances.
Regional Variations in Eligibility
The income and price caps differ by region, but the equity percentage (20% or 30%) does not. A first-time buyer in Donegal receives the same 30% as one in Dublin, though the price cap limits how expensive a property they can purchase.
Cork City and County are grouped with Dublin for the higher caps. This reflects new-build prices in these areas. Everywhere else in Ireland has the lower thresholds.
If you work in Dublin but buy in Meath, you use the Meath limits (€450,000 price cap, €80,000 income cap for joint applicants). The caps are based on where the property is located, not where you work.
Application Process
- Get mortgage approval in principle from a participating lender (AIB, Bank of Ireland, Avant Money, Haven, and others)
- Apply for the First Home Scheme through the local authority where the property is located
- Reserve a property with the developer
- Complete legal process through your solicitor
- Draw down mortgage and equity at closing
The local authority approval can take 4–8 weeks. Apply early in your purchase process to avoid delays. You need approval before signing contracts with the developer.
Tax Implications
There is no income tax on the equity you receive. It is not treated as income or a gift.
When you sell, you may owe Capital Gains Tax on any profit above your personal exemption. The government’s equity repayment reduces your net proceeds, but it does not reduce your CGT liability unless the property was your only or main residence (which usually exempts you from CGT entirely).
If you rent out the property before the five-year minimum occupancy period, you may be required to repay the equity immediately. The scheme is for owner-occupiers, not investors.
What Happens If You Can’t Repay?
If you sell the property and the proceeds are insufficient to cover your mortgage and the equity repayment (because the value fell significantly), you still owe the government their share. This is rare but possible in a severe downturn.
The equity repayment is a legal charge on the property, junior to your mortgage. If the property is repossessed, the lender is repaid first from sale proceeds, then the government. Any shortfall becomes an unsecured debt you owe to the state.
In practice, most buyers who use the scheme have a combined loan-to-value (mortgage plus equity) of around 80%, leaving a 20% buffer before they fall into negative equity.
Is the First Home Scheme Worth It?
The scheme works best if:
- You can afford mortgage repayments but lack a large deposit
- You’re buying in an area with strong price growth potential (equity growth is shared, so rising prices cost you more at exit)
- You plan to stay in the property medium-term (5–15 years) rather than trading up quickly
It’s less attractive if:
- You expect property prices to rise steeply (you’ll repay significantly more than €90,000)
- You can save the full deposit within 1–2 years
- You’re stretching your income to afford the mortgage—adding equity doesn’t reduce your monthly repayments, only the amount borrowed
Run the numbers based on realistic assumptions. If you think your €400,000 home will be worth €550,000 when you sell in 15 years, you’ll repay €165,000 for the 30% equity stake. That’s an effective cost of €75,000 for borrowing €90,000—similar to paying 4–5% interest annually, though with no monthly cost.
If prices stay flat or fall, the scheme becomes very attractive—you repay the same or less than you received, with no interest paid along the way.
Common Questions
Can I use the scheme for an apartment?
Yes, as long as it’s a new build and meets all other criteria. The same price and income caps apply.
What if I get a pay rise after applying?
Your income is assessed at application. A raise after approval doesn’t disqualify you.
Can I rent out the property?
Not within the first five years unless you have exceptional circumstances and get written permission from the local authority. After five years, check your contract terms.
Do I need life insurance?
Mortgage protection insurance is required by your lender. There’s no separate insurance requirement for the government equity, but you should consider covering it in your policy.
Can I buy out the equity stake early?
Yes, at any time. The repayment is based on current market value, regardless of when you refinance.
Where to Start
If you think the First Home Scheme suits your situation:
- Check the income and price caps for your target area
- Use a mortgage calculator to see how much you can borrow
- Contact a broker to get approval in principle
- Identify eligible properties (newly built homes within the price cap)
- Apply to your local authority for scheme approval
The government website provides a full list of participating lenders and local authority contacts. Your solicitor will handle the legal side of registering the equity charge against your property.
The scheme significantly improves affordability for buyers who are mortgage-ready but deposit-light. Whether it’s financially optimal depends on your timeline and expectations for property prices—but for many buyers, getting on the ladder now outweighs the risk of paying more later.
See also: Help to Buy Scheme Ireland | How Much Can I Borrow? | First-Time Buyer Mortgages Ireland | Mortgage Deposit Requirements Ireland | Central Bank Mortgage Rules Ireland