Chapter 6 of 10 · Buying in a particular situation · 9 of 14
Buying a second home in Ireland: the deposit and the tax
Checked 21 Oct 2026the Central Bank's mortgage measures, Revenue's rules and the scheme operators' published terms.
Holiday homes and second properties: mortgage rules, deposits, stamp duty, LPT, CGT on a later sale and renting it out.
Written in plain English for the person buying, selling or switching. This guide covers the Republic of Ireland only.
A second home is bought with the same contract and the same stamp duty as a first. What changes is the mortgage, which depends on what the home is for, and the taxes after you buy, which fall on two homes instead of one. This guide works through the deposit, the loan, stamp duty, Local Property Tax, the capital gains tax that comes later, and the rules on letting it.
What counts as a second home
For this guide, a second home is a home you buy while keeping the one you live in. It might be a holiday home, a place near work, a home for a child at college, or a home you plan to let. The mortgage rules split these into two groups.
- A home you will live in part of the year and not let out. The Central Bank's rules treat a loan on it as a home loan.
- A home you will let out, for all or most of the year. The rules treat that as a buy-to-let.
The split decides the deposit, so settle it before you talk to a lender.
The deposit and the mortgage
| A second home you will live in part of the year | A second home you will let | |
|---|---|---|
| Most a lender can give | 90% of the price | 70% of the price |
| Minimum deposit | 10% | 30% |
| Income limit | 3.5 times gross income, as you have owned before | None; the lender tests the rent against the repayment |
| Exemption allowance | 15% of the lender's mover lending in a year | 10% of its buy-to-let lending |
| Mortgage protection | Required by law | Not required |
Read the Central Bank rules and buy-to-let mortgages.
Two points on top of the rules.
- Lenders add their own policy. Many ask for more than 10% on a holiday home, and some do not lend on holiday homes at all. Ask before you plan around 90%.
- Your first mortgage counts. The 3.5 times limit is on your total borrowing for homes. If you earn €90,000 and owe €150,000 on your home, the most a lender can add is €165,000 (3.5 times €90,000 is €315,000, less €150,000).
A broker (on the Central Bank's register) can tell you which lenders take holiday homes; read about the mortgage advisor.
A worked example
Gráinne and Pat earn €110,000 between them and owe €120,000 on their home in Dublin. They want a €260,000 cottage in Kerry for weekends and summers, not for letting.
- 3.5 times €110,000 is €385,000. Less the €120,000 they owe, the most a lender can add is €265,000.
- The loan on the cottage is capped at 90% of €260,000: €234,000. That is within the €265,000.
- Their deposit is at least €26,000. A lender that asks 20% on a holiday home wants €52,000.
- Stamp duty is 1% of €260,000: €2,600.
- At 3.5% over 25 years, €234,000 costs about €1,171 a month.
If they let the cottage instead, the loan would be capped at 70%: €182,000, with a deposit of €78,000. The stamp duty calculator and the repayment calculator cover the two sums.
Stamp duty
Stamp duty is the tax on buying property. The rates since 2 October 2024 are 1% on the price up to €1 million, 2% on the part from €1 million to €1.5 million and 6% above. They apply to every residential purchase. There is no higher rate for a second home and no relief for a first. On a new home the duty is on the price without VAT. Your solicitor (check the Law Society's register) files and pays it within 44 days. Read stamp duty and about the conveyancing solicitor.
Local Property Tax on two homes
Local Property Tax (LPT, see the glossary) is charged on every home you own, each year. Each home is valued and banded on its own, at its value on 1 November 2025 for the years 2026 to 2030. The basic charges start at €95 for a home up to €240,000, €235 to €315,000, €333 to €420,000 and €428 to €525,000. Your council can adjust by up to 15% either way.
The owner on 1 November pays for the next year. If you buy in October, you pay for the following year; if you buy in December, the seller does. Read LPT for a new owner and run the LPT calculator.
Capital gains tax later
Capital gains tax (CGT) is charged on the gain when you sell. Your main home is covered by principal private residence relief. A second home is not, because you can have only one main home at a time.
- The rate is 33%. Budget 2027 announced 31% for disposals from 7 October 2026, waiting on the Finance Act 2026 (see changes).
- The gain is the price you sell for, less the costs of selling, less what you paid, the costs of buying and any improvements.
- The first €1,270 of gains each year is exempt for each person.
- If the second home later becomes your main home, the years you live there get relief, and the last twelve months of ownership always count.
Keep the receipts for the purchase costs and every improvement, because they come off the gain years later. Read capital gains tax when selling and principal private residence relief. The CGT calculator shows the tax for any dates.
Here is the example again. If Gráinne and Pat sell the cottage in 2036 for €330,000, with €10,000 of selling costs and €5,000 of buying costs, their gain is €55,000. Less two annual exemptions of €1,270, the taxable gain is €52,460. At 33% the tax is €17,312; at the announced 31% it is €16,263.
Renting it out
Letting a second home brings duties, and it changes the mortgage.
- Tell the lender. A home loan on a second home assumes you live in it. Letting it without consent breaks the loan terms. The lender may move it to a buy-to-let rate.
- Long-term letting. Register the tenancy with the Residential Tenancies Board (RTB) within a month. The tenant has the rights in the Residential Tenancies Act, including notice periods and rent limits in rent pressure zones. Read buying a house with tenants for those rights from a buyer's side.
- Short-term letting. In a rent pressure zone, letting a home that is not your main home for short stays needs planning permission, and a registration regime for short-term lets applies. Check with your council before you list it.
- Tax on the rent. The profit after allowable costs is taxed as income, with USC and PRSI. Revenue's pages set out what can be deducted. This guide does not give the figures.
- A BER. Needed before a home is advertised for rent, from a BER assessor (on SEAI's register). Read about the BER assessor.
Insurance and protection
Home insurance on a second home costs more if it is empty for long stretches, and many policies have conditions about how long it can be left unoccupied. Tell the insurer what the home is for. Mortgage protection is required on a home loan under the Consumer Credit Act 1995, section 126, but not on a home that is not your residence. Read about home insurance and mortgage protection.
Where this leaves you
Decide what the home is for, because that fixes the deposit at 10% or 30% and everything after it. Then run the price through the stamp duty calculator and the loan through the repayment calculator. The moving home journey covers a purchase alongside the home you keep, and get quotes puts you in touch with a solicitor and a surveyor for the second home.
Questions people ask
How much deposit do you need for a second home in Ireland?
It depends on what the home is for. A second home you will live in for part of the year is a home loan: at least 10%, and the loan is capped at 3.5 times your income. A home you will let out is a buy-to-let: at least 30%. Lenders often ask for more than the minimum on a holiday home.
Is stamp duty higher on a second home in Ireland?
No. Stamp duty is 1% up to €1 million, 2% on the part to €1.5 million and 6% above, on every residential purchase. There is no extra rate for a second home.
Do you pay Local Property Tax on a second home?
Yes, on every home you own, each year. Each home is valued and banded on its own. The owner on 1 November pays for the following year.
Do you pay capital gains tax on a second home in Ireland?
Yes, on the gain when you sell, because principal private residence relief covers only your main home. The rate is 33%, with 31% announced in Budget 2027 for disposals from 7 October 2026, waiting on the Finance Act 2026. The first €1,270 of gains each year is exempt.
Can I rent out my second home?
Yes, with duties. A long-term tenancy must be registered with the RTB. Short-term letting needs planning permission in rent pressure zones and must follow the short-term letting rules. Rent is taxed as income, and your lender must know the home is let.