Costs of Buying A Home In Ireland

There are additional costs associated with purchasing a property in addition to the mortgage. Before making the purchase, it is crucial to be aware of these as they may be substantial. The primary costs associated with buying a home are described below.

Home Deposit

The minimum deposit amount is 10% when getting a mortgage from a local institution. A deposit of at least 10% of the purchase price is required for first-time buyers. It may be more depending on your circumstances e.g. second-time buyers. You must then pay the remaining balance of the purchase price as stated by the Central Bank lending regulations over the course of your mortgage term. 

You may be eligible for the Help-to-Buy (HTB) incentive if you are a first-time buyer buying a newly constructed home or building your own home. This incentive can be utilised to help you with the down payment.

Agency fees for lenders

These fees involve the cost of the lender’s survey and searches, as well as an application charge. Additional charges for mortgage loan costs and an indemnity bond to guarantee that the lender won’t suffer a loss in the event of a home repossession may also be included.

Legal Costs associated with buying a home

The cost of legal services is not standardised. For conveyancing work (the legal procedure involved in purchasing a home) solicitors can provide competitive prices. A percentage of the home’s purchase price may be charged by some and a flat fee by others. 

Other fees, such as Land Registry fees and fees for legal searches, could be incurred during the legal process. The legal fees also require payment of Value Added Tax. The Legal Services “Regulatory Authority’s Guide to Legal Charges” has more details concerning the legal fees and the disclosures that your solicitor is required to make about them.

Buyer’s inspection charge

You are welcome to conduct your own independent inspection of the property to look for flaws. This inspection is distinct from the one conducted by the loan agency. 

An externally completed survey will cost money, and the price can differ greatly depending on the selected surveyor. To set up an inspection of the property you are best to locate a surveyor on the Society of Chartered Surveyors Ireland. 

Mortgage Protection Insurance

Mortgage protection insurance is a requirement for buyers to cover the remaining balance of your loan should you pass away before it is entirely re-paid. Generally speaking, lenders must ensure that you have adequate mortgage protection coverage when you take out a home loan, while you are not required to directly arrange this insurance through them. As the loan amount decreases throughout the course of the loan, mortgage protection premiums also go down.

Home Insurance

Although it is not required by law, most mortgage lenders will demand that your home is properly insured. Generally speaking, both the structure and the contents of your home should be included in your home insurance policy. It is recommended to shop around different insurance providers to get the best premium price. You are not required to purchase home insurance from your mortgage lender. 

Stamp Duty

Stamp Duty is a tax you pay on your property. When you purchase a home, you must pay for it. It is based on the property’s final sale price.

For properties valued up to €1 million, the new rate is 1.0% of the full value. For properties valued over €1 million, the rate of 1.0% applies to the first €1 million and a rate of 2.0% applies to the balance.

Local Property Tax

Depending on when you purchase a home, you might be required to pay all or part of the local property tax (LPT). Every year on November 1st, LPT is due on all residential properties in Ireland. Depending on the value of your property, different LPT fees apply to your home. Before finalising the transaction, your solicitor should verify the LPT information for your new house, including determining whether any fees or payments are still owed on the property.