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Shared equity scheme will have ‘substantially lower’ interest rates than UK equivalent

Ireland’s shared equity scheme will have “substantially lower” interest rates than a similar scheme in the UK.

Darragh O’Brien told the Oireachtas housing committee that he would be bringing legislation forward in the next two to three weeks to establish the scheme, which will see €75m of government funds allocated to allow the Government to offer equity loans of up to 30% on new-build homes under €400,000.

The scheme will have no salary cap and will be aimed at allowing younger people to purchase their first homes.

Sinn Féin’s Eoin Ó Broin told the committee that this could add a minimum of €50,000 to the lifetime cost of a €100,000 equity portion. He said that it was “crucial” to understand whether the Irish scheme would be done on a compound interest basis or based on the Year One principal.

Mr O’Brien said that details were “still being worked through” and were not finalised but said the Irish scheme was different to the UK’s and that this will be the “first affordable scheme in decades”.

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