First Home Scheme (FHS)

First Home Scheme (Ireland) - What it is and How it Works

The First Home Scheme (FHS) is a Government‑backed shared‑equity scheme that helps eligible buyers bridge the gap between their deposit and mortgage and the price or build cost of a new home. It is designed for first‑time buyers, ‘fresh start’ applicants and qualifying tenants purchasing the home they currently rent, as well as eligible self‑builders.

Objectives of the First Home Scheme

The Scheme aims to make home ownership achievable by:

(i) addressing the affordability gap where the maximum mortgage and deposit still fall short;
(ii) supporting supply of new homes across all local authorities; and
(iii) enabling buyers to purchase or build a principal private residence within local property price ceilings.

How the Shared‑Equity Works

The FHS contributes a percentage of the purchase price (or, for self‑builds, the build cost) in return for an equity share in your home. You can redeem (buy back) this equity at any time in one payment or in stages. If you also use the Help to Buy (HTB) Scheme, the FHS maximum is reduced accordingly.

Maximum equity: up to 30% of the price/build cost (or up to 20% if you also use Help to Buy).
Minimum equity: 2.5% of the price/build cost, or €10,000, whichever is higher.
No fees or charges for the first five years; from year six, a service charge applies (see ‘Service Charges’).
The equity share is secured on the property and must be cleared on certain events (see ‘Legal Aspects’).

Eligibility (with Key Figures)

To qualify, you must be over 18, a first‑time buyer or otherwise eligible (for example, a ‘fresh start’ applicant), and buying or building a new home for use as your principal private residence. You must have Mortgage Approval (in principle) from a participating lender and generally borrow the maximum available to you (typically up to four times income, without a Macro Prudential Exception). A minimum 10% deposit is required. The property must fall within the price ceiling for its local authority area.

Property types: new‑build houses/apartments in private developments; eligible self‑builds on a privately owned site; or a qualifying tenant purchase of the home you currently rent (following a landlord notice to sell).
Deposit: at least 10% (for self‑builds, site equity can count toward the deposit).
Income: no specific income cap, but lenders’ borrowing limits apply (generally up to 4x income).
Regional price ceilings: each local authority has a maximum qualifying price; your purchase must be at or below the local ceiling for the property type.

Service Charges (Years 6 Onwards)

There are no fees or charges on the equity share for the first five years. From year six, an annual service charge is applied to the equity amount. The charge accrues daily and is billed monthly, and you may choose to pay it, part‑pay it, or defer it (deferred charges continue to accrue and must be cleared later).

Years 0–5: 0.00%
Years 6–15: 1.75%
Years 16–29: 2.15%
Year 30+: 2.85%

Benefits of the Scheme

Bridges the affordability gap so you can complete a purchase or self‑build.
Available alongside Help to Buy (with a reduced FHS maximum), potentially lowering your required mortgage.
Flexible redemption: you can buy back the equity at any time, in part or in full.
Available nationwide with local price ceilings to reflect regional markets.

Risks and Key Considerations

Price‑linked equity: the euro amount to redeem rises if your home’s value increases (and falls if it decreases).
Service charges: from year six, ongoing charges apply until the equity is redeemed.
Second charge (‘inhibition’): the equity is registered on title; you’ll need to clear it on sale and in certain other cases.
Use restrictions: the home must be your principal private residence; letting the whole property is not permitted under the scheme.
Lender limits: you must generally borrow the maximum available from a participating lender, which may affect affordability checks.

Regional Variations (Price Ceilings)

50Each local authority sets a property price ceiling for houses, apartments and self‑builds. Your purchase/build cost must be at or below the relevant ceiling for the area and property type. Ceilings are reviewed and updated periodically.

Always check the current limits for your local authority area before committing to a purchase.

For example, as of the latest update, the price ceilings are as follows: In Dublin City, Dún Laoghaire–Rathdown, Fingal, South Dublin and Wicklow, the ceiling is €500,000 for houses, apartments, and self‑builds. In Galway County, the ceiling was €425,000 in 2025 and €450,000 in 2026 for all property types.

These figures are subject to periodic review and may change.

Application Process – Step by Step

Check eligibility using the FHS online calculator and confirm your local authority area.
Obtain Mortgage Approval in Principle from a participating lender.
Create an FHS portal account and generate a Preliminary Certificate (optional while you finalise choices).
Submit your application with required documents (AIP, ID, proof of address, and, if applicable, self‑build costings or a landlord notice of termination).
If approved, receive an Eligibility Certificate and give it to your lender so they can issue your Mortgage Letter of Offer including FHS funding.
Review and sign the Customer Contract (your solicitor will witness and return documents).
On closing, FHS releases funds to your solicitor in parallel with mortgage drawdown.

After Approval and Ongoing Management

You will receive a welcome letter and annual statements showing your equity share, any redemptions and service charges.
You may redeem at any time (in stages or in full); a valuation may be required to calculate the redemption amount.
If you plan to sell, switch lender, move out, or rent the whole property, you must notify the FHS (these are mandatory redemption events).

Legal Aspects

The equity share is formalised by a Customer Contract and secured on your title by an inhibition registered with the Property Registration Authority. Your solicitor receives and returns the required documents before funds are released and registers the inhibition on completion. Certain events trigger mandatory redemption of the equity share and payment of any accrued service charges.

- Mandatory redemption events include: sale of the property; switching to a non‑participating lender; the home ceasing to be your principal private residence; and death (of the sole owner, or of all joint owners).
- Letting the whole property is not permitted; room‑letting is allowed if you continue to live there as your principal private residence.
- You must maintain adequate buildings insurance and keep the FHS informed of material changes (for example, adding/removing a party to the equity facility).

SUMMARY

The First Home Scheme can be a practical way to bridge an affordability gap on a new‑build purchase or self‑build. It offers substantial support (up to 30%, or up to 20% with Help to Buy), with flexible redemption and nationwide coverage.

Balanced against these benefits are long‑term considerations:

Service charges from year six,
price‑linked redemption amounts,
and legal obligations such as keeping the property as your principal private residence and clearing the equity on sale.

The FHS conditions may be subject to change. For more information and most recent updates visit First Home Scheme website: www.firsthomescheme.ie.

Jacob Law LLP, September 2025

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