The eligibility criteria for homes being purchased by first-time buyers with state assistance under the €400m First Home Scheme has been extended following a biannual review.

The maximum value limit for homes will increased by €75,000 in 30 out of 31 local authority areas, likely meaning thousands more first-time buyers will qualify for the scheme.

Under the scheme, part of the purchase price will be provided to buyers to add to their deposit and mortgage, with the state paying up to 30% of the cost of the new home in return for an equivalent stake in the property.

The new price ceilings, which come into effect on 1 January, will include houses with prices of up to €475,000, depending on the location, and all new homes valued at €325,000 or less will now be eligible.

The price ceilings for apartments will remain unchanged at €500,000 in Dublin and in Cork city; and €450,000 in Galway city, Limerick and Waterford. The next review will take place in mid-2023.

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“The First Home Scheme is making a real difference for the people who have already used it to buy a home and I expect they will be joined by thousands more in 2023 and beyond," said Minister for Housing Darragh O'Brien.

"Housing for All has affordability at its heart and, as a result of the changes to the price criteria that are being announced today, the Scheme will be made available to thousands more First-Time Buyers.

"The scheme is working effectively and it’s great to see that the flexibility we’ve built into it allows it to extend its reach and help more people. It’s an excellent support for renters who want to become buyers and ultimately helps them bridge the affordability gap.”

Michael Broderick, CEO of the First Home Scheme, said that close to 2,000 people had expressed interest in the scheme, with over 500 approvals made in the scheme's first three months, from July to September.

"That momentum has continued in the run-up to Christmas and we’re on course to help a lot more people to buy a home in 2023," Broderick continued.

"We promised at our launch in July that we’d review the price ceilings twice a year and we’re delighted that, following our first review, we can now extend the Scheme to a whole new cohort of buyers.

"For those who found themselves above the old limits, this is now a great opportunity for them to benefit from the Scheme in 2023.”

The scheme is conducted by the government in partnership with AIB, Bank of Ireland and Permanent TSB.

(Pic: Getty Images)