On this page
- What shared equity actually means
- Who FHS is for
- Who FHS is not for
- The funding gap formula
- Worked example 1 — Tadhg and Sinead: Cork City couple
- Worked example 2 — Ruairi: Galway self-build
- Worked example 3 — Daire: Dublin solo buyer using HTB + FHS
- Long-term cost — redemption and service charges
- How FHS works alongside Help to Buy
- Where the calculator helps and where it stops
- Three Irish patterns
- Next steps
Who FHS is for
- First-time buyers purchasing or self-building a new home in Ireland.
- Fresh Start applicants — separated, divorced, or insolvency-discharged people who previously owned a home. The eligibility test is narrower than first-time buyer status. Read the Fresh Start guide for the exact conditions.
- Buyers whose mortgage approval plus deposit does not reach the property price, where the property is within the relevant local authority price ceiling.
- Buyers using a participating lender.
Who FHS is not for
- Anyone buying for investment or letting.
- Anyone whose mortgage + deposit already covers the price — FHS only fills a gap. It is not a top-up.
- Anyone whose property exceeds the local authority price ceiling for the relevant county.
- Anyone using a non-participating lender.
- Most second-hand home buyers — the separate Tenant Home Purchase route covers some tenants buying from their landlord, but it is a different application path and is not what most second-hand buyers think it is.
The funding gap formula
The maths is simpler than people expect:
Funding gap = Property price − (Mortgage approval + Cash deposit + Help to Buy if used)
FHS fills part of that gap, up to a percentage cap, up to the local ceiling, up to your eligibility.
| Situation | Maximum FHS support |
|---|---|
| FHS used alone (no HTB) | Up to 30% of property price or approved valuation |
| FHS used together with HTB | Up to 20% of property price or approved valuation |
The reduction from 30% to 20% when HTB is used is deliberate scheme design. HTB already reduces the deposit you need to find. FHS is intended as a last-resort gap filler, not a top-up to maximise total state support.
Worked example 1 — Tadhg and Sinead: Cork City couple
Tadhg and Sinead are buying a new-build 3-bed house in Cork City for €420,000.
- Joint mortgage approval: €340,000
- Cash deposit saved: €42,000
- Help to Buy estimated refund: €30,000
Total funds before FHS: €340,000 + €42,000 + €30,000 = €412,000.
Funding gap remaining: €420,000 − €412,000 = €8,000.
Because they are using HTB, the 20% combined cap applies: 20% of €420,000 = €84,000. That is comfortably above the €8,000 they actually need. FHS therefore supports the €8,000 gap, taking a corresponding equity share in the home. Tadhg and Sinead can complete the purchase.
FHS’s equity share of their home: €8,000 ÷ €420,000 = about 1.9%. That is the percentage that will be redeemed later, applied to the home’s then-current market value.
Worked example 2 — Ruairi: Galway self-build
Ruairi owns a site in rural Galway worth €60,000 (gifted by family). He has mortgage approval of €280,000 and €18,000 in cash. His approved build cost is €340,000.
- Site value (treated as deposit contribution): €60,000
- Mortgage: €280,000
- Cash deposit: €18,000
Total before any scheme: €358,000 — already above the €340,000 build cost. Ruairi does not need FHS. The site value alone closes the gap. He may still consider HTB (subject to self-build eligibility), but FHS is not required.
This example matters because many self-builders apply for FHS reflexively without checking whether they actually have a funding gap. If site value plus mortgage plus deposit already covers the build, FHS adds shared-equity overhead for no reason.
Worked example 3 — Daire: Dublin solo buyer using HTB + FHS
Daire is buying a new-build 1-bed apartment in Dublin City for €395,000, within the FHS price ceiling for his local authority.
- Mortgage approval: €280,000 (his maximum — 4× his single income of €70,000)
- Cash deposit: €20,000
- HTB estimated refund: €30,000
Total: €330,000.
Funding gap: €395,000 − €330,000 = €65,000.
The 20% combined cap (because HTB is used): 20% of €395,000 = €79,000. That covers the €65,000 gap. So Daire can take FHS support of €65,000, meaning FHS holds an equity share of €65,000 ÷ €395,000 = about 16.5% of his apartment.
When Daire eventually sells or redeems, 16.5% of the then-current market value goes back to FHS. If the apartment is worth €500,000 in fifteen years, FHS’s share would be €82,500, not €65,000. If the apartment is worth €350,000 because of a market downturn, FHS’s share would be €57,750.
Estimate your funding gap with the First Home Scheme Calculator
Long-term cost — redemption and service charges
This is the part most first-time buyers don’t think about until year 6.
- Years 1–5: no service charge. The equity stake exists but you pay nothing year-to-year.
- From year 6: a service charge begins, calculated as a percentage of the equity stake’s current market value. The percentage steps up at year 16, then again at year 31.
This means an FHS-supported home becomes more expensive to keep over time if you don’t redeem. The full year-by-year picture is covered in the Service Charges Explained guide.
You can also redeem the FHS equity stake at any time — pay FHS its current share of your home’s value, in full or partially, using savings, a remortgage, or an inheritance. Many buyers plan to redeem within 5–10 years specifically to avoid the year-6 service charge.
How FHS works alongside Help to Buy
In short: HTB reduces the deposit you need to find. FHS closes any remaining price gap. They are usually applied in that order.
When you use HTB with FHS:
- The FHS maximum reduces from 30% to 20%.
- You apply to each scheme separately.
- Most lenders prefer HTB to be approved before FHS.
The full sequence, including a combined worked example, is in Using HTB and FHS Together.
Where the calculator helps and where it stops
The FHS Calculator estimates:
- Your funding gap
- The likely equity share percentage
- A planning estimate of service charges across the years
It does not confirm:
- That your specific lender is currently a participating lender
- That the property is within the current price ceiling for your local authority
- That your Fresh Start status will be accepted
- That your build cost is "approved" for self-build purposes
Use the calculator as a planning tool. Use the FHS application portal to confirm eligibility before going sale-agreed.
Three Irish patterns
| Pattern | Best fit | Why |
|---|---|---|
| FTB couple, new-build family home, mortgage falls short of local prices | HTB + FHS combined | HTB lowers deposit need, FHS closes remaining gap |
| FTB solo buyer with healthy deposit but limited borrowing on single income | HTB only if possible | Avoid taking shared equity if not strictly needed |
| Self-builder with significant site value | HTB only, FHS only if a gap remains | Site value usually closes most of the gap |
| Fresh Start applicant, post-divorce | FHS via Fresh Start; HTB has a stricter FTB definition | Read Fresh Start guide |
Next steps
- Check your county limit: Price Ceilings Ireland.
- Plan long-term cost: Service Charges Explained.
- Compare with HTB: Using HTB and FHS Together.
- Check your borrowing limit: Mortgage Affordability Calculator.
- Estimate repayments: Mortgage Repayment Calculator.
Frequently asked questions
Is the First Home Scheme actually a loan in disguise?
No. It is a sharedequity arrangement. The state and participating banks take an equity share in your home rather than lending you money. You make no monthly repayments to FHS, and there is no interest in the traditional sense — but you do owe back the equity share when you sell or choose to redeem.
What's the maximum amount FHS will give me?
Up to 30% of the property price if you use FHS alone, or up to 20% if you also use Help to Buy. The actual amount is the smaller of your funding gap and that percentage cap, and only up to the local authority price ceiling. Many buyers use much less than the maximum because the funding gap closes long before the cap does.
Why does FHS drop from 30% to 20% if I add Help to Buy?
Because HTB already reduces your deposit shortfall. FHS is designed as a lastresort gap filler rather than a topup to maximise total state support. The combined cap of 20% reflects that design.
Do I ever pay anything to FHS year by year?
For the first five years, no. From year 6 onwards a service charge applies on the current market value of the FHS equity share, with stepups at year 16 and again at year 31. This is why many buyers plan to redeem before year 6.
Can I use FHS to buy a second-hand house?
Standard FHS is for newbuilds and selfbuilds, not secondhand homes. A separate route called Tenant Home Purchase covers some tenants buying from their landlord, but that is a different application path and most secondhand purchasers cannot use it.
How do I actually pay FHS back?
You can redeem the equity stake in full or partially at any time by paying FHS the current market value of its share. Most buyers fund redemption from savings, a remortgage at a stronger LTV, or an inheritance.
If my house doubles in value, does FHS take twice as much back?
Yes. The FHS share is a percentage of the property's value, not a fixed euro amount. If FHS owns 16.5% of a home that doubles in price, the redemption cost doubles too.
Which banks actually offer FHS mortgages?
AIB, Bank of Ireland and Permanent TSB are the participating lenders. If you have an Approval in Principle from a different bank, FHS will not be available on that mortgage.
What happens if I cannot pay the FHS service charge later?
The service charge is a debt secured against the FHS equity stake. Persistent nonpayment can lead to enforcement action. If your longterm affordability is uncertain, take independent legal and financial advice before signing the FHS agreement.
Sources & references
Related calculators
Use these tools for the numbers behind this guide.