FHS Self-Build: Your Guide to Affordable Homeownership

2023-09-27

Introduced in July 2022, the First Home Scheme (FHS) originally catered to first time buyers purchasing newly built houses or apartments. Since its launch, the FHS has been extended to accept applications from tenants who have received a Notice of Termination and who wish to purchase their rental home. This extension is known as the Tenant Home Purchase Scheme (THPS) Last week the scope of the FHS was further expanded to include applicants seeking to self-build their own home anywhere in Ireland. This article is a guide to the FHS Self-build product, explaining how it works and outlining the eligibility criteria.

What is a self-build home?

It is a home that is built on a site by the owners of the site, either through direct labour (i.e. self-managed) or a fixed contractor (i.e. construction contract). The home is intended to be the primary private residence of the owners and can be either detached or semi-detached, as well as single or multi-storey.

How does the FHS Self-build product work?

If you are self-building and you do not have sufficient funds to build your home when you combine your deposit and your mortgage, you may be able to bridge the funding gap by availing of the Self-build product subject to meeting certain criteria.

Eligible applicants can receive funding up to 30% of their home's construction costs. It is important to note that the Help to Buy (HTB) Scheme is also available for self-build homes. If you are availing of the HTB, the maximum amount you may be eligible for from the FHS will be 20% of the build cost.

What are the Self-build product eligibility criteria?

To be eligible for the self-build product, you must:

Be over 18 years of age
Be a first time buyer or other eligible buyer, which includes those who have purchased or built home with a former spouse, civil partner, or partner, and the relationship has ended (with no beneficial interest retained in the previous property), or those who have sold their home as part of a personal insolvency or bankruptcy arrangement
Have mortgage approval with a Participating Lender (Bank of Ireland Group plc, Permanent TSB plc, Allied Irish Bank plc - including AIB, Haven Mortgages and EBS)
Borrow the maximum amount available to you (4 times your income)
Not be availing of a mortgage exception
Have a minimum deposit of 10% of the build cost (equity in your site can contribute to the deposit).

To be eligible for the Self-build product, the home you are building must:

Be in Ireland on a site that you own or are purchasing
Be built as your Principal Private Residence
Be within the local authority property price ceilings for Self-builds.

What are the property price ceilings for Self-builds?

The property price ceilings for self-build homes differ according to the local authority area - a measure that is in place to ensure that aspiring homeowners across Ireland can afford to participate in the FHS. These ceilings represent the maximum allowable cost for your self-build project to make you eligible for the FHS. For more information on the property price ceilings, visit www.firsthomescheme.ie/about-the-scheme/property-price-ceilings/.

Getting started

Check your eligibility: Visit www.firsthomescheme.ie and use the FHS Eligibility Calculator to calculate your potential funding through the FHS.
Start your application: Once you have contacted Which Mortgage and we have assisted you in obtaining your mortgage approval in principle, you can use this along with your estimated build cost to start your application on the FHS website.
Receive your eligibility certificate: Your application and supporting documents will be reviewed and, upon approval, you will receive an Eligibility Certificate. Provide this to your lender, who will consider the FHS when processing your mortgage application.
Receive your customer contract: Once you have your Loan Offer, upload it to your FHS Customer Portal along with your Certified Valuation as instructed by your lender, and your Certified Build Cost from a qualified architect, engineer or quantity surveyor. Upon approval, you will receive your FHS Customer Contract for your equity facility. This is the formal legal contract between you and the FHS.
Building your home: From the date of signing the FHS Customer Contract, you have 12 months to draw down your FHS Equity Facility. FHS funds will be released to your solicitor's account after you have received the first mortgage stage payment from your lender, and once your solicitor returns a Fund Requisition Form, along with a Certified Property Report to confirm works completed and planned. You have 24 months to complete the build of your new home from the date you draw down your FHS Equity Facility.

The expansion of the FHS to include self-builds opens up exciting opportunities for individuals and families across Ireland to achieve homeownership with the support of up to 30% of their home's construction cost. Don't miss out on the chance to make your dream home a reality through the First Home Scheme's Self-build product.

Contact us for support through your mortgage journey and into the future.