Minister for Housing Eoghan Murphy has announced a revamped Government-backed loan scheme targeted at first-time buyers struggling to obtain finance.
Under the scheme, a person or couple can borrow up to 90% of the value of a new, second-hand or self-build home to a maximum of €320,000 in the Greater Dublin area, Cork and Galway and up to €250,000 in the rest of the country.
Borrowers will pay a fixed interest rate of 2% to 2.25% for 25 to 30 years.
Income cannot exceed €50,000 for a single person or €75,000 for a couple.
In a statement, Mr Murphy said: "What this means essentially is that a person or couple can purchase a home, while ensuring that they can still keep their monthly repayments to one third of their net disposable income - with no risk of their mortgage rate rising and so no threat to their ability to afford repayments, giving them certainty and security."
However, Sinn Féin's spokesperson on housing says the Government needs to focus on bringing down the cost of housing, rather than giving people more credit.
Speaking on RTÉ's Morning Ireland, Eoin Ó Broin described the housing proposals as "very disappointing".
Mr Ó Broin said the details were vague and that real targets, to increase affordable housing, need to be set and achieved.
This, he said, would require State investment in council-led, affordable housing schemes built on public land.
Mr Ó Brion said the State should be focused on investing in good quality homes instead of "cumbersome" schemes working with the private sector, or loan facilities.
"The real problem is, it's going back to the old days of assisting people to buy overpriced housing rather than bringing the cost of housing down," Mr Ó Broin said.
"So, I'm not convinced that the loan scheme is either anything new, or anything that's going to produce a significant benefit for first time buyers."
The three main elements of today’s package are:
The Rebuilding Ireland Home Loan;
Affordable Purchase Scheme;
Affordable Rental Scheme.
The announcements come as Housing Minister Eoghan Murphy holds a second housing summit with the 21 local authorities today to ensure they meet the social housing construction target of 3,800 homes this year.
The minister is to publish the building targets for each local authority after today’s summit.
Mr Murphy has secured €200m for the initial phase of the Rebuilding Ireland Home Loan, but it is intended to raise additional funds when this is exhausted.
To apply for the new mortgages, which will be available through local authorities, a single person’s annual gross income cannot exceed €50,000, while a couple cannot earn more than €75,000.
The scheme will take account of Central Bank rules, meaning applicants will be able to borrow up to 90% of the market value of the property.