Give first-time buyers a break on stamp duty
PROPERTY
Property Insights with Johnny Gannon, Fair Deal Property
By the time first-time buyers reach the closing stage, many have stretched their finances to the limit. They have saved while paying rent, chased rising prices and competed in bidding wars. Then they must find the money for stamp duty.
This tax arrives at the worst possible time. It demands additional hard cash from depleted reserves, on top of the 10% deposit. With mortgage funds committed to the purchase price, buyers must reach into their own pockets once again.
On a €400,000 second-hand home, a buyer with a 10 per cent deposit needs €40,000. Stamp duty adds €4,000, before legal fees, a survey, valuation and moving costs. That is another tenth on top of the deposit.
Calling it “only 1 per cent” misses the reality for the person paying it.
I see buyers reach this point with almost nothing in reserve. Knowing the bill is coming does not make finding the money any easier.
For buyers in Tuam and across Galway, €4,000 would make a big difference in covering the cost of furnishing a new home.
Budget 2027 offers an opportunity to ease that pressure through targeted stamp duty relief for first-time buyers.
The objection deserves a fair hearing. With too few homes available, buyers could use the saving to bid more, pushing up prices and benefiting sellers. Borrowing limits do not eliminate that risk.
That calls for careful design and scrutiny.
I am calling for an exemption for first-time buyers purchasing a home to live in, with eligibility capped at €500,000.
Help to Buy can provide up to €30,000 for eligible buyers of newly built homes. Buyers of second-hand properties cannot access it, despite facing the same pressure to assemble a deposit and pay the costs of purchase. They deserve some assistance too.
Money saved on stamp duty would help pay for furniture, appliances and improvements, supporting local shops and tradespeople. That is money circulating through the local economy as buyers settle into their homes.
On purchases carrying 23% VAT, almost a fifth of the total price is tax. Part of that spending therefore returns to the Exchequer.
Buyers deserve to begin home ownership with a house they can afford to furnish. First-time buyers have suffered long enough. It is time to give them a break.
For advice and more information visit www.fairdealproperty.ie.