Budget 2025 includes a series of significant housing and taxation measures aimed at supporting first time buyers, renters and landlords, while also discouraging bulk purchases of homes by investment funds.
Help to Buy Extended to 2029
The Help to Buy scheme has been extended until the end of 2029. Minister for Finance Jack Chambers said the extension provides long term certainty for prospective buyers and the housing market. Since its introduction, the scheme has enabled more than 50,000 individuals and couples to purchase newly built homes, allowing them to claim up to €30,000 towards their deposit.
Rent Tax Credit Increased
The rent tax credit will rise by €250 next year, bringing the value to €1,000 for an individual and €2,000 for jointly assessed couples for 2025. In recognition of ongoing cost of living pressures, the same increased credit will also apply retrospectively for 2024.
Support for Vacant Property Owners and Landlords
To encourage the return of vacant homes to the rental market, the relief for pre letting expenses for landlords will be extended for three more years, until the end of 2027.
Mortgage Interest Tax Relief, introduced in last year’s budget to help homeowners facing higher interest costs, will also be extended for one additional year. The extended relief will apply to the increase in interest paid in 2024 compared with 2022.
Stamp Duty Changes to Curb Bulk Purchases
In an effort to deter large scale acquisitions of houses by investment funds, the higher stamp duty rate on bulk purchases has been increased from 10 percent to 15 percent with immediate effect. Minister Chambers said such purchases reduce the number of homes available to ordinary buyers and the increase reflects the Government’s intention to limit this activity.
Additional changes will also apply to high value residential property. While rates of 1 percent for homes up to €1 million and 2 percent for values above €1 million remain unchanged, a new higher rate of 6 percent will apply to any portion of value above €1.5 million from tonight.
Vacant Homes Tax and VAT on Energy
The Vacant Homes Tax is set to rise from five times the Local Property Tax rate to seven times the rate, taking effect from the next chargeable period beginning in November. The aim is to incentivise owners to bring empty homes back into use.
Separately, the reduced 9 percent VAT rate on gas and electricity will be extended for another six months, until April 2025, as part of the Government’s broader cost of living supports.
