This is how few starter homes now up for sale would qualify for the help-to-buy scheme

Only 212 eligible developments were available to buy across Ireland yesterday

This is how few starter homes now up for sale would qualify for the help-to-buy scheme

File photo: PA Wire

Concerns have been raised this week that the help-to-buy scheme announced as part of the budget will only further drive up house prices.

The package provides first-time buyers with a tax rebate of up to €20,000 on purchases of homes worth up to €600,000.

To qualify, your house must be a new build – no secondhand or buy-to-let properties are eligible – and your mortgage must for at least 80% of its cost.

Fianna Fáil has described the incentive as a "mansion grant" and called for the threshold to be capped at €400,000.

Critics of the scheme have also argued that it fails to address the severe shortage of available housing in big towns and cities.

In the first half of 2016, for instance, only 4,874 planning permissions were granted for new houses nationwide.

And a Newstalk study of properties for sale on yesterday shows that only 212 listings for three-bed homes would have qualified for the scheme. 

These listings included both individual homes and developments where all properties:

  • had three or more bedrooms;
  • were priced at less than €600,000.

The highest number of eligible developments were in Dublin (66), Cork (20), Meath (18) and Kildare (18).

First-time buyers in Carlow and Leitrim were worst placed, with not one newly-built home available in either country.

Click on individual counties on the map to see more:

The findings appear to support arguments that the problem in the current market is one of supply rather than demand.

Making this point earlier in the week, the Society of Chartered Surveyors Ireland said that the government should have focused instead on measures that would help stabilise house prices.

Fianna Fáil spokesperson Barry Cowen also criticised the package, saying: "People expected the government to put forward a credible housing package in Budget 2017 aimed at addressing the lack of housing supply.

"Unfortunately what was unveiled instead was a risky first-time buyer’s scheme which is unlikely to have any meaningful impact on shaking up the housing market."

However, Minister for Simon Coveney insisted yesterday that the scheme would kick-start construction.

"I think actually what will happen now is that you will see a lot of first-time buyers very frustrated and they will say, 'there are not any new houses to buy; where are they?'" he said, responding to criticism from Fine Gael. 

"The result of that, I hope, will be a response from the construction industry to say there is now not only demand but there is the capacity to buy  on the back of that demand and we need to get on and build quickly."

Minister Coveney has predicted that between 4,000 to 6,000 first-time buyers will benefit from the incentive.