THE GOVERNMENT'S new "Homechoice" loan scheme for first-time house purchasers is being challenged in Brussels on the basis that it is confined to newly-built homes and excludes second-hand and self-build houses.

More than 250 people have lodged a formal complaint to the European Commission's Directorate-General for Competition, claiming that the scheme is anti-competitive and constitutes "unlawful State aid" to property developers.

"The central condition underlining the operation and rationale of this scheme is that only new-build dwellings qualify for the provision of subsidised mortgage finance - to the exclusion of the second-hand and self-build segments of the housing market."

They say this is "for no other reason than that this scheme has been designed from the outset to advantage a defined cohort of vendors".

Traditionally, Government grants to first-time house purchasers - which were abolished in 2002 - were limited to newly-built homes, to the exclusion of second-hand houses.

However, this restriction was never challenged by any complaint lodged with the European Commission.

Read More