Buying a home step-by-step guide

When you are saving for a deposit, work out where your money is going and how much you can afford to put away. We have lots of tools to help you:

• Our spending calculator can help you work out what you are spending your money on now and where you can cut back.
• We have lots of handy money saving tips to help you save your deposit.
• Opening a regular savings account is a good way to help you save a deposit and will also show any mortgage lender that you have a solid savings record. This will be important when you apply for a mortgage. Our regular savings Money Tool will help you compare the different savings accounts available.

First-time buyers

If you are a first-time buyer you can borrow up to 4 times your gross annual income. A 90% limit will generally apply to the mortgage you can get. This means you will need a minimum deposit of 10%.

The Help to Buy (HTB) incentive is a scheme to help first-time buyers get a deposit for a home. It allows you to claim back tax that you have paid in Ireland the last four years. The relief available to first-time-buyers was increased in July 2020, and this increase has been extended in subsequent budgets. This increase which is known as the Enhanced Help to Buy Scheme was extended until 31 December 2022 in Budget 2022. The amount that you can claim is the lesser of:

• €30,000 (previously €20,000)
• 10% of the price of a new home (previously 5%). For self-builds this is 10% of the completion value of the property.
• The amount of Income Tax and Deposit Interest Retention Tax (DIRT) you have paid in the four years before you buy or build.

The maximum payment is €30,000 per property. You can find more information about the scheme from Revenue.

First-time buyers may also be eligible for the government’s First Home Scheme. This is a shared equity scheme and can provide up to 30% of the purchase price of a home. Read more about the First Home Scheme.

Second or subsequent buyers

If you are a second or subsequent buyer you can borrow up to 3.5 times your gross annual income. A 90% limit will generally apply to the mortgage you can get. This means you will need a minimum deposit of 10%.

Lenders have a limited amount of discretion when it comes to these limits. For more information see the Central Bank of Ireland rules.

Carefully review your budget to see how much you can afford to spend on mortgage repayments each month and to make sure that you have enough to cover the other costs involved in buying and maintaining a house. These are shown below along with an approximate cost for each.

• Stamp duty (1%-2% of the price of the house)
• Legal fees (€2,500 – €5,000 including conveyancing)
• Survey costs (€200)
• Engineers report (€450)
• Moving costs
• Repairs, decoration, furniture

You should also consider the running costs of a house once you have moved in.

• Electricity and heating – BER rating will have a significant impact on this
• Home insurance
• Maintenance and repairs
• TV
• Broadband
• Property tax
• Bin charges
• TV licence
• Management fees, if you buy an apartment or house in a managed complex

Use our budget planner to work out what you can comfortably afford to repay each month. Include a regular amount for unforeseen expenses in your budget such as medical expenses, interest rate increases etc.

When you have worked out this amount and what deposit you will have, you’ll be able to work out how much of a mortgage you can afford.

You can start talking to lenders either before or after you have saved your deposit. You might want to approach lenders to find out how much you may be able to borrow and that will help you work out how much you need to save.

You can apply directly to lenders for a mortgage or use a broker. You can view and compare all of the mortgages available in the Irish market using our mortgage Money Tool. These include fixed and variable rate mortgages and all of the different interest rates available.

The most important thing to think about is the interest rate. Many lenders offer incentives such as cashback which can seem very appealing, especially if you are a first-time buyer. However, you need to consider the overall cost of the mortgage and the interest rate, along with the number of years, will have the biggest impact on the total amount your mortgage will cost you.

You should try to get mortgage approval in principle before you start looking at properties, so you have a clear idea of the price range you should be looking at. It also means you will be taken seriously by the seller if it comes to making an offer on a property.

Mortgage Protection Insurance

Once your mortgage application is approved, you should look for mortgage protection cover which is insurance that will pay off your mortgage if you die within the term of the policy. You should not wait until you have made an offer on a house or apartment before shopping around and applying for mortgage protection insurance. It can take some time to get approval, particularly if you have had poor health in the past. This could delay the sale as, by law, your lender must make sure that you have this cover before giving you a mortgage. Your lender may agree to give you a mortgage without you having this cover if:

• you are over 50
• you are buying an investment property
• you have enough life insurance in place already or
• you cannot get cover

However, your lender can insist on you having the cover and can refuse you a mortgage if you cannot get it. Most mortgage lenders offer to arrange mortgage protection insurance for you when you apply for a mortgage. You do not have to take your lender’s insurance, you are free to shop around for better value or a more suitable policy.

For more information see the mortgage section of our website.

While you are looking for a property, you should also look for a solicitor to do the conveyancing – this is the legal work to transfer ownership of the property from the seller to you. It is a good idea to choose a solicitor before you start looking at properties, because as soon as your offer is accepted, the estate agent will ask for your solicitor’s details to pass onto the seller’s solicitor. Your solicitor will also check that the sale of the property is legal – that the person who is selling the property owns it and has the right to sell it, and that nobody else could claim to own it.

Solicitor’s fees can vary considerably and may be either a percentage of the property price or a flat fee. You will usually be charged extra for services like telephone calls, postage, search fees and registering deeds. So, before you choose one, ask several different solicitors for written quotes and details about their professional fees and other costs.

See our finding a solicitor guide for more information

Finding a solicitor (PDF 130Kb)

You are now ready to start your search. It is important to thoroughly check out the area you are interested in moving to. Download our checklist here:

Looking around for a property (PDF 130Kb)

You can look online for information about the area and speak to members of local community or sports groups for any information that may be helpful in making your decision.

When you find a home you are interested in, remember to ask the estate agent any questions you have which might help you make your decision. We’ve included some of these in our guide to Finding out more about a property:

Finding out more about a property (PDF 230Kb)

If you are ready to make a bid on a property, ask if the seller’s solicitor is in possession of the title deeds. If they are not, this can add 4-8 weeks to the time it takes to complete the sale.

Check the BER Rating

A Building Energy Rating (BER) certificate is required by anyone advertising a home for sale or rent, or before a new home is occupied for the first time. It shows how energy efficient the property is and checks energy use for space heating, water heating, ventilation and lighting. A home is rated between A and G, with A-rated homes being the most energy efficient. A higher energy rating can have a significant impact on reducing the ongoing cost of running your home.

For more information on BER ratings, go to the website of Sustainable Energy Authority of Ireland (SEAI).

When making an offer set yourself a maximum price you are willing to pay for the property and do not exceed this. It is important to factor in also the condition of the house and whether you will need to spend money on it in order to move in. You can check the Property Price Register to see what the property, or other properties in the area, have sold for recently.  It does not give details about the condition of the property or any other arrangements linked to the sale. It will however give you an indication of the price history of the property or what similar properties in the area have sold for.

If you are selling a home as well as buying another, you’ll be in a better position if you have already found a buyer for your own home when it comes to making an offer on another property.

Make sure you are in a strong position when making an offer by having a letter from your lender showing that you have mortgage approval in principle, and a bank statement showing you have the funds available for the deposit. Estate agents will look more favourably on a bid when you can prove that you are ready to buy.

A seller will take the bid that suits them best, which may not necessarily be the highest bid. If you can provide proof of funds and/or proof that your current house is sold, they will look more favourably on your offer as there is less likelihood of the sale falling though or being delayed.

Once your offer is accepted the property is considered to be sale agreed and you will need to pay a booking deposit to the estate agent. Booking deposits vary – they can be a specific amount such as €5,000, or a small percentage of the offer you have made. The booking deposit is refundable up until you sign the contracts. Paying your booking deposit is a strong signal to the estate agent that you intend to buy the property and will usually mean that the home won’t be put on the market again for three to four weeks.

Once your offer is accepted, the estate agent will prepare a document of sale details and send this to the seller’s solicitor and to your solicitor. This document contains details of the price, conditions of the sale, the estimated closing date – the day you will be given the keys of the property – and the names and addresses of all those involved in the sale.

Once the seller’s solicitor receives the sale details from the estate agent they will send the contracts for the sale of the property, along with a copy of the Title Deeds of the property to your solicitor. Title deeds are legal documents showing the ownership of a particular property. Each time the ownership changes a new deed is drawn up to show the change.

Have a survey carried out

You should strongly consider hiring your own surveyor, engineer or architect to carry out a detailed structural survey, especially if you are buying an older property. This will highlight any issues you may not have been aware of when you made your offer. For example, if your surveyor discovers that the roof needs to be replaced, you may change your offer to account for this, or decide not to buy the property.

If you are buying a property at an auction, you would usually have your survey completed before the auction. Ask the auctioneer for the terms and conditions of the auction, which will be available before the auction date.

Snag list

If you are buying a newly built home, you and your solicitor will receive a completion notice from the builder once all the work is finished. As soon as you receive this, you should arrange to have a snag list drawn up. This is a list of incomplete work or things that you want put right. Examples of items for a snag list include:

• cracks in ceilings or walls
• skirting boards not correctly placed
• doors that don’t open and close properly
• uneven plaster work
• broken light switches
• loose wiring
• leaking pipes

You can make a snag list yourself, but it can be better to hire an architect, engineer or chartered surveyor who has experience in this area and knows what to look for when snagging a new home. Once the snag list is complete, you give a copy to the builder. The builder will then work on fixing the snags.

You should do a final inspection of the new property to make sure that all the snags have been fixed. You can do this on your own, or with the person you hired to do up the snag list. The cost of hiring them may be higher if you want them to inspect the property with you.

Think about agreeing a defects liability period with your builder before you sign any contracts. This means that you agree that the builder will fix any further problems that arise within a certain period of time free of charge. Sometimes you can withhold a small percentage of the purchase price of the property until the end of this period. Discuss this with your solicitor first to see if it is possible.

Draw down your mortgage

Before your bank will release your mortgage funds there are a number of steps that you will need to complete.

Get a valuation

Once the property is sale agreed, you will need to arrange a valuation. Your lender will want a professional valuation completed before they formally agree to lend you the money to buy the property. The valuation will only look at the general state of the property and the location. The valuer will send their valuation to your lender who will base their formal loan offer on this valuation.

Home Insurance

Before your mortgage cheque is issued, you will need to have home insurance in place. Once the property is sale agreed you should start looking for insurance so that the house is covered by the time the sale is closed. If you are buying an apartment, buildings insurance should be part of your management fee, so you don’t need to arrange this yourself. However, you may still want to arrange contents insurance before you move in.

Mortgage approval

Once all the conditions of the mortgage have been met, your lender will approve your loan for the property and the amount, and will send you a formal ‘letter of offer’. This sets out the details of the mortgage your lender is offering you, including:

• The value, length, cost and repayment schedule of the mortgage
• The address and description of the property to be bought
• Any terms and conditions which apply to the offer
• Expiry date of the mortgage offer

Your bank will send a copy of your letter of offer to your solicitor, along with other legal paperwork, so you should arrange to meet with your solicitor as soon as possible after getting your letter of offer.

Signing contracts

Your solicitor will explain and complete various documents with you. If you are happy with all the details, you formally accept the letter of offer from your lender, through your solicitor. Your solicitor will also check that the contracts are in order and if they are happy with the contracts, you will sign two copies. Your solicitor will return both of these copies to the seller’s solicitor. At this point you have legally agreed to buy the property.

You will then need to pay your deposit, usually 10-20% of the purchase price depending on whether you’re a first-time buyer or not, less any booking deposit you have paid. You pay your deposit to your solicitor, who will arrange to have it paid to the seller through their solicitor.

Once the seller’s solicitor receives the signed contract and your deposit, they and the seller will sign and return one copy of the contract to your solicitor. At this point the seller has legally agreed to sell you their property.

Both solicitors will arrange for a final closing date and time at which stage you will be given the keys to the property. Before this, the remainder of the money must be paid, which means all the paperwork and approval for your loan must be completed and returned to your lender by your solicitor.

Once your lender is happy that they have all the paperwork and it is in order, the mortgage cheque will be issued to your solicitor. Your solicitor will arrange to have these funds transferred to the seller through their solicitor.

Stamp duty

Stamp duty is the tax you pay when you buy a property. The rate is 1% of the purchase price for properties valued up to €1 million, and 2% on any amount over that. Your solicitor will arrange to pay the stamp duty for you, but bear in mind you will need to pay the money to your solicitor when they are closing the sale.

Local Property Tax – LPT

When buying or selling a property you may have to pay some or all of the Local Property Tax (LPT), which is charged on all residential properties in Ireland, depending on the time of year you buy or sell. The LPT currently falls due on 1 November each year. Visit Revenue’s website for more information on the LPT.

Registration Fees

Registration fees are the costs associated with registering the title with either the Registry of Deeds or the Land Registry. Fees can range from €400 to €800, depending on the value of the property. Get information on fees here. www.prai.ie

Collect your keys and move in

Once the balance of the funds has been transferred to the seller by the agreed closing date and time, the estate agent will call you and explain that everything is in order for closing. The estate agent will also remind the seller of the closing date and time.

If you are also selling a property you should try and exchange contracts and close on the same day so you can move straight into your new home, if possible. Once the estate agent tells you that the keys are ready to be collected, the property is officially yours, so the seller must have left the property, and removed any items not included in the sale, by then.

It is also now your responsibility to make sure that the property is safe and secure, so if you are not moving in straight away you should still visit the property. Make sure you have appropriate insurance in place, keeping in mind that some policies may not fully cover you if the house is vacant for an extended period of time. You may also want to consider changing the locks, as other people may have been given keys to the property by the previous owner.