I want to buy a house but have no deposit: rent-to-own and low-deposit options (guide)
In Ireland, certain schemes allow households to explore home-ownership pathways with reduced upfront costs. This guide explains rent-to-own models, shared equity schemes, lender requirements, and the documentation typically needed. It helps readers understand how these structures work before assessing whether they may fit their circumstances.
Buying a home with little or no savings can feel out of reach, especially when deposit requirements and rising costs add pressure. In Ireland, however, a mix of pathways—private rent-to-own agreements and government-backed supports—can bridge the gap for some buyers. Each route has its own rules, risks, and long-term implications. Below, we unpack how rent-to-own works in practice, outline shared equity supports, explain lender assessments and documentation, and offer a structured way to compare your options.
How rent-to-own works in Ireland
A rent-to-own (sometimes called rent-to-buy) arrangement is a private agreement between a landlord or developer and a tenant that grants an option to purchase the property within a defined period. Typically, the buyer pays an upfront option fee that secures the right to buy later, and part of the monthly rent may be credited towards the future purchase price. The purchase price can be fixed at the start or determined by a future valuation, which should be clearly documented.
Because these agreements are not standardised nationwide, terms vary widely. Key points to negotiate and document include: the option fee and whether it’s refundable, the rent credit formula, the timeline to exercise the option, responsibility for repairs and insurance, treatment of property tax, and what happens if financing is not approved. Independent legal advice and a thorough survey are essential. If you cannot complete the purchase by the deadline, you may lose the option fee and any rent credits, so ensure the timeline aligns with realistic mortgage readiness.
Shared equity schemes and criteria
Shared equity allows an eligible buyer to purchase a new home with part of the price funded via an equity stake rather than additional debt. In Ireland, the First Home Scheme supports first-time buyers and certain “fresh start” applicants purchasing eligible new-build homes from participating developers. The scheme can take an equity stake up to a maximum percentage of the purchase price (reduced when combined with the Help to Buy incentive). Price caps apply by local area, and you must secure a mortgage from a participating lender.
Over time, you can redeem some or all of the equity stake, or it will be settled on sale of the property. A service charge applies after an initial period and increases in later years. As with any equity product, consider the long-term cost and how changes in property value could affect the amount owed on redemption. Always check current eligibility rules, property price caps in your area, and lender participation before proceeding.
Lender requirements and evaluations
Irish lenders assess affordability under Central Bank rules and their own credit policies. For first-time buyers, the loan-to-value limit is typically 90%, meaning a 10% buyer deposit. Lenders also apply a loan-to-income cap, commonly up to 4 times gross income for first-time buyers, with limited exceptions at their discretion and within regulatory quotas.
Beyond ratios, lenders stress test repayments against higher interest rates, review net disposable income, and analyse your repayment history and existing commitments through the Central Credit Register. Regular savings or consistent rent payments can help demonstrate repayment capacity. Improving your profile—reducing short-term debt, avoiding overdrafts, and keeping accounts in good order for several months—can strengthen an application.
Needed documents for affordability checks
Be prepared to provide: recent payslips; employer confirmation of employment; bank statements (typically 6 months) for current, savings, and credit card accounts; proof of savings or rent payments; identification and proof of address; details of loans or credit agreements; and, where applicable, a gift letter for any gifted funds. Self-employed applicants usually need up-to-date financial statements, tax returns, and Revenue documents. Lenders will cross-check your credit through the Central Credit Register, so ensure any errors are corrected before you apply.
Keep paperwork consistent: names and addresses should match across documents, and unexplained large lodgements should be clarified. Having your documentation complete and orderly reduces back-and-forth with underwriters and can accelerate approval.
How to compare ownership pathways
To weigh rent-to-own versus low-deposit mortgage options, map each route against practical criteria: upfront cash required; monthly cost and volatility; eligibility constraints; legal protections; timeline to full ownership; exit options and penalties; and long-term cost, including equity service charges versus mortgage interest. Also consider how each path fits your employment stability and whether your income is likely to grow to meet future affordability tests. If you plan to use local services in your area—such as brokers, solicitors, or surveyors—seek providers experienced with the specific pathway you’re pursuing.
A focused way to compare the main options, including indicative cost elements, is below. Figures are general estimates and vary by provider, product, property price, and circumstances.
| Product/Service Name | Provider | Key Features | Cost Estimation (if applicable) |
|---|---|---|---|
| Rent-to-own agreement | Private landlord/developer | Option to purchase after a rental period; option fee; potential rent credit; terms set by contract | Option fee often agreed case-by-case (commonly 1–5% in practice); rent credit varies; legal and valuation fees apply |
| First Home Scheme (shared equity) | First Home Scheme (Gov.-backed) | Equity stake towards new-build purchase; redeemable; service charge applies after initial years | Equity up to a maximum percentage of price; service charge applies after year 5; amount and rates published by the scheme |
| Help to Buy (HTB) | Revenue Commissioners | Tax refund towards deposit for eligible new-builds/self-builds | Up to 10% of price capped at €30,000; no interest or fees on the grant |
| Local Authority Home Loan | Local Authorities | Fixed-rate mortgage for eligible first-time buyers; assessment of income and credit | Deposit generally around 10%; fixed rates set by scheme and subject to change; legal and valuation fees apply |
| Bank mortgage (first-time buyer) | AIB, Bank of Ireland, PTSB (and others) | Up to 90% LTV; up to 4x income typical, with limited exceptions | Buyer deposit about 10%; interest rate depends on lender/product; additional purchase costs apply |
Prices, rates, or cost estimates mentioned in this article are based on the latest available information but may change over time. Independent research is advised before making financial decisions.
Real-world cost notes: even with supports, you should budget for non-deposit expenses. Typical items include solicitor fees and outlays, a structural survey, a lender valuation, and mortgage protection and home insurance. Stamp duty on most residential purchases is 1% up to €1,000,000 (and 2% on any amount above that). Rent-to-own buyers should also budget for the option fee and clarify whether any rent credit is guaranteed and how it is calculated.
Conclusion For buyers without savings, rent-to-own can create a bridge to ownership through a private option, while low-deposit routes—shared equity, Help to Buy, local authority lending, and standard bank mortgages—provide structured paths under clear eligibility and affordability rules. The right choice depends on your timeframe, income stability, and tolerance for long-term costs. A careful comparison of upfront cash, monthly affordability, legal protections, and exit terms will help you select a pathway that supports sustainable home ownership in Ireland.
