Ireland's housing market is undergoing a transformation, with private landlords leaving the rental market. While this might raise concerns for some, it also brings a silver lining for Irish tenants - the chance to transition from renting to homeownership. The prospect is particularly promising because of government initiatives like the Tenant Home Purchase Scheme (an extension of the First Home Scheme).

The Rental Tenancies Board's (RTB) Q2 2023 Notice of Termination statistics shed light on the current rental market landscape, revealing that out of 5735 Notices of Termination received by the RTB during this period, 3633 landlords terminated leases with the intention of selling the property. This creates a unique opportunity for tenants to purchase these properties and take their first steps onto the property ladder.

At the heart of this opportunity lies the Tenant Home Purchase Scheme. Introduced earlier this year, it is an initiative that assists tenants who have insufficient funds to purchase their rental home when they combine their mortgage and deposit. To bridge the funding gap, eligible applicants can receive up to 30% of the property purchase price.

The eligibility criteria that apply under the FHS also apply to THPS applicants, with some differences: Unlike FHS applicants, THPS applicants are required to have 10% of the property's purchase price available to them, and they cannot avail of the  Help to Buy Scheme because the property they are purchasing is a second-hand home. THPS applicants are also required to include a valid Notice of Termination in their application, which is not required of FHS applicants.

In March 2023, the Minister for Housing announced plans for the introduction of a First Right of Refusal policy. This will allow tenants the opportunity to make the first bid to buy their home if their landlord terminates the lease with the intention of selling the property. Although it is not yet in place, the First Right of Refusal, combined with the Tenant Home Purchase Scheme, promises significant benefits for renters who are eager to escape the rental market.

With private landlords leaving the market and government initiatives supporting tenants, there has never been a better time to make the transition from renting to homeownership. To make the most of this opportunity, tenants should focus on diligent planning, evaluating their financial readiness, researching available properties, and seeking advice from mortgage specialists.

For more information and support with your mortgage application, contact us today.