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Both Fine Gael and Fianna Fáil want to extend the shared equity scheme to the second-hand market. Alamy

Help-to-Buy? What experts are saying about the contentious housing schemes

The measures have been branded ‘classic auction politics’.

LAST UPDATE | 11 Nov 2024

SOME HOUSING MARKET analysts have warned that prices would be pushed even higher by Fine Gael’s pledges to hike Help to Buy grants by a third to €40,000 and to expand the First Homes shared equity scheme to second-hand property.

Fianna Fáil’s manifesto, launched this morning, also included a pledge to expand shared equity - whereby the state purchases a stake of up to 30% in a new home to help first-time buyers bridge the gap between their mortgage and deposit and the price – to second-hand homes. Fianna Fáil also said it wants to “protect and extend” Help to Buy.

At present, shared equity, launched in 2022, is only for new and self-built homes, meaning people who want to buy a home in areas where new homes are not being built cannot avail of state subsidies. Help to Buy is also only for new builds.

The ESRI has previously warned that Help to Buy is likely to increase prices for new builds, given constrained supply and robust demand for housing.

Taoiseach Simon Harris indicated today that these policies could be a red line issue for Fine Gael in future coalition talks, stating: “We will not go into government in any scenario where the rug is pulled from under first-time buyers.” 

‘Classic auction politics’

Lorcan Sirr, a senior lecturer in TU Dublin, said the two proposals amounted to “classic auction politics, using young people as a tool”.

He said both measures would be inflationary, with the boost to the Help to Buy grant likely to have the more immediate impact as developers could price in the increased grant straight away.

The impact of extending shared equity to second-hand homes would also be to increase prices but it would take longer to “seep in”, and was particularly likely to affect prices for the smaller houses that first-time buyers would tend to go for.

“There will be more people with more money bidding against each other,” he said.

He added that the Help to Buy increase was “quite likely…to lead to increased new home prices” with “no guarantee” of any trickle-down boost to supply.

‘Not what we need’

Barra Roantree, assistant professor in economics at Trinity College, said both measures “are likely to put upward pressure on house prices”.

“Both will benefit some potential homeowners, but neither do anything to address the fundamental issue, which is that we aren’t building enough homes,” Roantree said.

“Demand-side subsidies of varying extents just aren’t what we really, really need. What we really, really need is ways of making it easier and cheaper to build. And we’re just so far not seeing that from, to be honest, any party,” Roantree said.

He said Fine Gael’s pledge to hike the Help to Buy grant would be the more inflationary of the two proposed policies because it was a direct transfer of wealth.

Estate agent

However, on the potential for inflation, Kevin Delappe, director of Brocke Delappe estate agents in Dublin, said he believed “we have hit or very close to an affordability ceiling at the moment”.

He said the two initiatives represented welcome support for first-time buyers and would give them more options, but the effectiveness of the proposed extension of shared equity could be limited by “the realities of the second-hand market”.

“Many homes in this category need modernisation as a significant proportion of these are probate [sales] or landlords exiting the market and without added support for refurbishment buyers could face significant out-of-pocket costs that might limit the policy’s benefits,” Delappe said.

Harris defends policy

At Fine Gael’s housing policy launch today, where the party – currently leading in the polls – pledged to spend €10bn of Apple tax money on housing, Minister for Public Expenditure Paschal Donohe was asked about the potential inflationary impact of its election promises to first-time buyers.

Donohoe said the best way to stop homes from becoming more unaffordable was to build more homes.

He said Help-to-Buy would still only be available for new-builds, and the increase in the threshold was smaller than the one made in 2020, when there was a 50% hike from €20,000 to €30,000.

Donohoe, his party’s housing spokesman, said there are price caps in the first home scheme, “thereby minimising the effect that that change could have in the inflation of new or second-home properties”.

These price ceilings range from €350,000 in rural counties to €475,000-500,000 across Dublin and in Cork city.

Opposition parties, including Sinn Féin and Labour, have pledged to phase out Help to Buy.

With reporting by PA.

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    Mute F1rYnpWc
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    Nov 11th 2024, 4:09 PM

    FF,FG had their chance to solve housing. Give them no votes.

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    Mute Paul Gorry
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    Nov 11th 2024, 11:21 PM

    @F1rYnpWc: Watching the two best dressed men, Darragh O Brien (ff) and pascal Donoghue(fg) on rte a few minutes ago proves your very well made point. Two rabbits caught in the headlights. The opposition made them look like fools. Fffg OUT…

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    Mute Tim Brennan
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    Nov 11th 2024, 11:27 PM

    @F1rYnpWc: no problem except the only track record SF is in blowing them up

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    Mute Paul Gorry
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    Nov 11th 2024, 11:33 PM

    @Tim Brennan: 2024! And you’re still licking a lolipop for 100 years of failure.

    43
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    Mute Tim Brennan
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    Nov 12th 2024, 12:28 AM

    @Paul Gorry: when you gang up with hairy fairy proposals that the banks won’t give you a mortgage for doesn’t sound very promising

    16
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    Mute Tim Brennan
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    Nov 12th 2024, 12:29 AM

    @Paul Gorry: no problem any better than the provos from Belfast running this country look north the provos are in power with even more difficult housing problems

    16
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    Mute Colette Byrne
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    Nov 12th 2024, 12:39 AM

    @Tim Brennan: well they well ans truly blew them up tonight, neither fffg had a leg to stand on.

    27
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    Mute Paul Gorry
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    Nov 12th 2024, 12:58 AM

    @Tim Brennan: Like every fffg lover jumping on the bandwagon, hey tim!! Liberal Democrats, Labour, and ritchie also put them in their place.Nowhere to hide anymore tim. Fffg = Fail. Carry on with your fffg ( love in) tim. The rich agree with you, the homeless don’t IMO…

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    Mute Paul M Doe
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    Nov 12th 2024, 1:04 AM

    First debate was a home run for the mighty FG :)

    14
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    Mute Sheila McNulty
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    Nov 12th 2024, 5:24 PM

    @Paul Gorry: talking nonsense so they have respect going on television both of whom always dress well , & neither are fools, so your point is is on here to make you feel better by trying to belittle them grow up

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    Mute Sheila McNulty
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    Nov 12th 2024, 5:37 PM

    @Colette Byrne: dream on

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    Mute Frank Mc Carthy
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    Nov 11th 2024, 4:09 PM

    I’m not a housing market analyst— but OBVIOUSLY prices will be inflated with these kinds of market interventions

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    Mute Brendan O'Brien
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    Nov 11th 2024, 5:42 PM

    @Frank Mc Carthy: How could you be a housing market analyst when you’re a full-time Internet troll?

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    Mute Paul M Doe
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    Nov 12th 2024, 12:37 AM

    @Brendan O’Brien: people in glass houses lol

    24
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    Mute Sean Stevenson
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    Nov 11th 2024, 4:30 PM

    Exactly what FFG want to appease their homeowner base. Every single policy of theirs adds upwards pressure on housing prices by providing buyers with more capital (FHS, HTB, etc) without providing anything substantial regarding increasing supply (Such as removing height limits for apartments, what skyline are we preserving? Have you ever looked up in Dublin? Nothing impressive). FFG are architecting a demographic timebomb, which will lead to the collapse of our pension system, due to young people not being able to afford a house, never mind start a family. Stuck in the rent trap because FFG have successfully sold our countries property market to the highest bidder instead of treating housing as the essential fabric of society that it is. Vote anybody but FFG. Don’t give them any preference

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    Mute Mr “JonnieBoy” Johnson
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    Nov 11th 2024, 5:24 PM

    @Sean Stevenson: if massive supply comes in time, fast forward 5 years and all those who buy will be in negative equity and some apartment blocks will be the new slums of the future.

    32
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    Mute The next small thing
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    Nov 11th 2024, 5:33 PM

    @Sean Stevenson: According to experts in the field, it costs over 500k to build a 2 bedroom apartment in Dublin. If you go higher then these costs will rise, so who will buy these apartments and who will take the risk building them? Or is the plan to keep building 3 bed semi’s and just cover the country with them.Until the country gets some sort of control on the numbers arriving into the country no party will be able to even mke a dent in the housing crisis.

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    Mute Sean Stevenson
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    Nov 11th 2024, 5:56 PM

    @Mr “JonnieBoy” Johnson: Oh nooooo!! Not negative equity!!! Screw our young being able to buy a home, won’t somebody think of the poor homeowners.

    25
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    Mute P. J.
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    Nov 11th 2024, 11:25 PM

    @The next small thing.
    Firstly we have one of the lowest population densities in the EU so the notion we are going to cover the country with houses is ridiculous.
    Yet we are going to need big numbers of immigrants to build the houses. The last time we went building crazy here most of the work was done by eastern europeans, young Irish people are not going building.

    9
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    Mute James Brennan
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    Nov 12th 2024, 12:35 AM

    @The next small thing: so a two bed appartment cost more than an 3/4 bed house, doesnt that raise a red flag???? When the powers that be are feeding off the crumbs of developmers and vulture funds of coruse we will have one of the highest price per unit build

    10
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    Mute Thomas Harrington
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    Nov 12th 2024, 7:29 AM

    @The next small thing: actually it’s gets cheaper once you over 5 floors

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    Mute Wolfgang Bonow
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    Nov 12th 2024, 9:15 AM
    1
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    Mute Paul Whitehead
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    Nov 11th 2024, 4:34 PM

    Of course it will. That’s the neo-conservative plan!!! Extra cash for their buddies. The only properly costed and effective plan is the SF one. Fully costed by the Dept of finance and received with positivity. Vote SF

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    Mute The next small thing
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    Nov 11th 2024, 5:36 PM

    @Paul Whitehead: We’re still waiting on how SF are going to be able to build houses for less than 300k in Dublin. SF also want social housing built by council direct labour crews and we have seen what the public sector are like when delivering any capital projects in relaton to budgets and timeframes.

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    Mute Paul M Doe
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    Nov 12th 2024, 12:40 AM

    @Paul Whitehead: SF are never an option. Bring back internment for those animals lol

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    Mute Paul M Doe
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    Nov 12th 2024, 12:41 AM

    @The next small thing: the only decent thing a shinner ever did was starve themselves lol

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    Mute james rowan
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    Nov 12th 2024, 8:08 AM

    @Paul M Doe: as whole

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    Mute Don't Forget
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    Nov 11th 2024, 5:07 PM

    Everyone has told it them that it would increase house prices for years. Their own advisors, any economists and anyone with a functioning brain.
    At what do we state the obvious which is that it’s their policy to increase house prices?

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    Mute hans vos
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    Nov 11th 2024, 6:14 PM

    Election pledges? They couldn’t keep their promises for umpteen years and still people believe them.

    55
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    Mute Penguin O'Toole
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    Nov 11th 2024, 4:22 PM

    This time last week I was saying that Trump would win bigly :)

    41
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    Mute SV3tN8M4
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    Nov 11th 2024, 7:51 PM

    Fianna Fail & Fine Gael would view House prices going up as a good thing, as it continues their cost cartel with the corrupt Developers, REIT’s, Vulture Funds & Investment Funds in this failed State.

    45
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    Mute Paul M Doe
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    Nov 12th 2024, 12:48 AM

    @SV3tN8M4: middle Ireland very much enjoys house price increases :)

    1
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    Mute Tommy
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    Nov 11th 2024, 5:41 PM

    2 cheeks of the 1 @rse is FG and FF and the Greedy Greens are the hairline crack.

    47
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    Mute Anthony Curran
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    Nov 11th 2024, 10:36 PM

    FG help to buy? Can we just call it what it actually is: a help the vultures scheme.

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    Mute Sheila McNulty
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    Nov 12th 2024, 5:35 PM

    @Anthony Curran: shows how wise u, Its only give to a family or couple buying a home no help to by goes to vulture funds wise up

    1
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    Mute RIP
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    Nov 11th 2024, 8:21 PM

    Really, does anyone believe any of the pledges and promises coming up to the election, No.
    Simply, if you’re satisfied with the present government, vote for them. If not, vote for change

    29
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    Mute Name
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    Nov 11th 2024, 6:02 PM

    FF has a long history of economic mismanagement, but to see FG also engaging full on in handouts and bad economic policy is concerning. There essentially is no fiscally responsible party left. Don’t give me Aontú, which is just catholic Sinn Fein. Makes the Greens almost look good, at least they’ve stuck money into infrastructure and sustainability instead of vote buying.

    22
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    Mute Tim Brennan
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    Nov 11th 2024, 11:17 PM

    @Name: cheers comrades

    14
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    Mute Shane O Neill
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    Nov 11th 2024, 11:58 PM

    A senior lecturer, an economics professor and an estate agent. No surprises which one of the three says help-to-but is a good idea.

    19
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    Mute Tim Brennan
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    Nov 11th 2024, 11:17 PM

    Breaking News Sinn Fein have great ideas on housing but no banks will fund anyone a mortgage to buy them.

    16
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    Mute Jimmy Kiely
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    Nov 11th 2024, 11:31 PM

    @Tim Brennan: I just watched a debate on rte 1 there just now, it’s obvious that FF/FG are the cause of the housing crisis, and they have no hope of rectifying the mess they made.

    26
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    Mute Tim Brennan
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    Nov 12th 2024, 12:32 AM

    @Jimmy Kiely: brilliant however The provos have proposals the banks won’t guarantee to give mortgages to would be buyers yet in government in 6 counties and housing crisis as bad as here

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    Mute Colette Byrne
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    Nov 12th 2024, 12:41 AM

    @Tim Brennan: not true,northern Ireland includes couch surfers etc. In the Republic they don’t.

    11
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    Mute Colette Byrne
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    Nov 12th 2024, 12:43 AM

    @Tim Brennan: did you not listen,banks will lend as they would be under government guarantee.

    11
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    Mute Sheila McNulty
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    Nov 12th 2024, 5:25 PM

    @Colette Byrne: maybe go check it out

    1
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    Mute D Farrell
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    Nov 11th 2024, 5:42 PM

    The help-buy-scheme allows couples to turn their paid income tax into a deposit for a first home. I think it’s a good scheme, and SF saying they’ll do way with it is wrong. Those working & paying tax get this welcome support.

    16
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    Mute lesidees
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    Nov 11th 2024, 6:07 PM

    @D Farrell: the help to buy scheme pushes up house prices. It increases the number of potential buyers (demand) but does nothing to increase the supply of houses

    52
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    Mute D Farrell
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    Nov 11th 2024, 6:31 PM

    @lesidees: The help-to-buy scheme helps first-time buyers only, not investors or those already on the property ladder. SF should not do way with it.

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    Mute Sean Stevenson
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    Nov 11th 2024, 7:09 PM

    @D Farrell: Why is this hard for you to grasp? It does not help first time buyers. It would only help first time buyers if houses were affordable and there was no supply issues. Right now, all it does is add upwards pressure to an already strained housing market, with developers simply pricing in help to buy when putting a house to market. Adding cash liquidity without significantly increasing supply does nothing but push prices up.

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    Mute D Farrell
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    Nov 11th 2024, 7:26 PM

    @Sean Stevenson: Help-to-buy scheme put first-time buyers in a better position compared to investors. Because SF wants to do away with it, perhaps they don’t like people working & paying income tax.

    9
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    Mute Sean Stevenson
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    Nov 11th 2024, 7:36 PM

    @D Farrell: Man, are you drunk? Your comment makes absolutely zero sense. Full FFG supporter intelligence on display here. How does SF not like people paying income tax because they don’t want to continue an inflationary scheme that does nothing but drive house prices up?

    28
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    Mute Paul M Doe
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    Nov 12th 2024, 12:47 AM

    Sk um fein hate working people

    12
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    Mute Sheila McNulty
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    Nov 12th 2024, 5:30 PM

    @Sean Stevenson: it was helped a hell of a lot of first time buyers

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    Mute Colette Byrne
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    Nov 12th 2024, 12:38 AM

    So the panel on upfront tonight were correct, and fgff were lying. How can people fall for these tactics.

    16
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    Mute Nigel Hayden
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    Nov 11th 2024, 11:27 PM

    Boomerang economics, what goes up must come down, when it does come down it’s the less well off who bear the brunt

    15
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    Mute JP
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    Nov 11th 2024, 10:49 PM

    Everyone who can is at the building. The roads are choc a bloc with lorries carrying building materials. What more can be done ? There are simply no more workers available. I don’t support any party and I cannot see any one of them with the required magic wand.

    14
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    Mute MN
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    Nov 11th 2024, 6:12 PM

    FFG are seeing this and thinking yeah great where’s the problem

    14
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    Mute smatrix mantra
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    Nov 11th 2024, 4:50 PM

    Would not mind my houses being worth more.

    11
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    Mute Anthony Curran
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    Nov 11th 2024, 10:38 PM

    @smatrix mantra: I bet ye live in yer ma’s attic.

    17
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    Mute Paul M Doe
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    Nov 12th 2024, 12:50 AM

    @Anthony Curran: if your parents got divorced would they still remain cousins? lol

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    Mute North Phone Bowe
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    Nov 12th 2024, 4:43 AM

    @smatrix mantra: houseS??? Equity in houses only really helps investors creaming an inflated low supply market, exactly what FFG policy was formulated for. Majority of family homes will never be liquidated in parents life time, thereafter with the hope that the inheritance from home will give children a foothold to buy their own home. So equity in that scenario is nullified with high costs of that foothold.

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    Mute Bernard Connolly
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    Nov 11th 2024, 5:28 PM

    Yet most people will vote FFG… the two will

    11
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    Mute Paul M Doe
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    Nov 12th 2024, 12:47 AM

    @Bernard Connolly: and rightfully so :)

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    Mute Pat Clancy
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    Nov 12th 2024, 1:53 AM

    Would anyone think that a state owned factory that would turn out modular houses that could be assembled in very short time would be a good idea. A rated and built in a few months surely has to be better than block built houses that take a year or more to build. Build them on state owned land and try and sort out the planning and objections

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    Mute Sheila McNulty
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    Nov 12th 2024, 5:27 PM

    @Pat Clancy: where is the state owned Factory ?

    1
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    Mute Paul M Doe
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    Nov 12th 2024, 12:51 AM

    Fantastic work as always from the mighty FG :)

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    Mute Adrian Aungier
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    Nov 12th 2024, 10:28 AM

    140000 homeless people excluding teh people that live with their parents FF hopeless party

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    Mute Colm Flaherty
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    Nov 12th 2024, 7:26 AM

    I’d love if you asked the experts which party’s policies have the desired effect, if any.

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