The Help to Buy scheme (HTB) is a tax rebate incentive offering First Times Buyers up to 10% of the value of a newly built home. The scheme was 1st introduced in 2017 & has proven to be extremely successful in assisting first time buyers to get on the property ladder. The scheme was recently extended & is due to run until Dec 31st 2024 for qualifying applicants. Below is a breakdown of the terms & conditions of the scheme:
Terms:
Up to 10% of the purchase price / approved valuation for a self-build property or max €30,000
Minimum mortgage amount must be for 70% of the purchase price or in the case of self-builds, 70% of the lenders valuation
Scheme is limited to properties costing less than €500,000; if a house costs or is valued at €501,000 then no rebate is payable
Amount available is limited to the total amount of PAYE and DIRT tax paid in the 4 years preceding the purchase of the property: if the applicants paid less than the 10% of the purchase price in tax then the rebate is limited to the actual amount of tax paid
Scheme is limited to new builds and self-builds only
So how much deposit will you need upfront?
So, you are a first-time buyer & are considering purchasing a newly built property or seeking to start your own self build. An example of the breakdown in funding is as follows:
Purchase Price: €350,000
+Legal Fees: €2,500 (assumed)
+Stamp Duty: €3,500 (1%)
Total needed: €356,000
-Max mortgage: €315,000 (90% of your purchase price)
-Help to buy funds:€30,000 (max available assumed)
Your contribution: €11,000
We would recommend applying to revenue to get your HTB amount confirmed as one of your 1st steps as this will guide you on how much you have to contribute yourself.
How to claim your Help to Buy:
Log onto myAccount on revenue & complete a Form 12 if PAYE or a Form 11 for self-assessed earners
HTB Conditions:
The property must be occupied by the First Time Buyer or at least one of the First Time Buyers as their main residence for a period of 5 years from the property is deemed habitable.
In the case where the property ceases to be the main residence within the first 5 years revenue will reclaim the rebate as follows:
Year 1 - 100%
Year 2 - 80%
Year 3 - 60%
Year 4 - 40%
Year 5 - 20%