Buyers of new Cairn Homes apartments at a development in Dublin face monthly mortgage repayments of €1,100 on a two-bed home, more than 50 per cent below average rents in Dublin.

The housing developer has sold 350 apartments that were built in its new Seven Mills development in Dublin 22. It has advertised a 51.5sq m, one-bedroom at prices between €235,000 and €275,000, while a 79.9sq m two-bedroom apartment costs circa €375,000.

These homes have been built with support from the State’s Croí Cónaithe (Cities) scheme, which was launched in 2022 to bridge the gap between how much it costs developers to build an apartment and the price owner-occupiers can afford to pay for apartments.

Cairn Homes chief executive Michael Stanley said on an analysts’ call on Wednesday, following the release of the company’s interim financial results, the Croí Cónaithe (Cities) scheme had been “incredibly impactful”.

“It is working because it moves people from homes that they rent, apartments that they rent, often costing €2,000 to €2,500 per month … We’re delivering apartments people can own for as little as €800 to €900 a month mortgage.”

Cairn Homes has estimated that monthly repayments on a €375,000 two-bedroom apartment would be €1,168 if a first-time buyer received €30,000 through Help to Buy, took out a €270,000 mortgage and used the First Home Scheme to fund the remaining €67,500, equivalent to an 18 per cent equity stake.

A company analysis said that with the support of Croí Cónaithe alone, a household would need an income of €84,375 to buy a two-bed unit in Seven Mills. The income requirement falls to €67,500 if they received First Home Scheme support.

The latest Daft rental report showed the average rent for a two-bed apartment in Dublin is close to €2,600 per month.

Stanley said the company had received a lot of interest from renters, with more than 4,000 inquiries to buy apartments in the Seven Mills development.

The company has availed of a subsidy of close to €90,000 on each Seven Mills apartment delivered through the Croí Cónaithe (Cities) scheme. Apartments partly funded through the scheme must be sold by developers on the open market to buyers who intend to be owner-occupiers.

The company is also developing apartments in Douglas, Co Cork, with support from the same scheme. The average selling price of two-bed apartments in this scheme are priced close to €400,000, which would equate to a mortgage level of about €1,600.

[ Cairn Homes flags higher construction inflation as average selling prices riseOpens in new window ]

Based on the subsidies applied to apartments in Dublin, Cairn’s total cost to build these apartments without a subsidy would be between €330,000 and €400,000. Mortgages on apartments at these price points would also be below average rents.

The Croí Cónaithe (Cities) scheme, launched with a budget of €450 million, aimed to activate the delivery of 5,000 apartments for sale to owner-occupiers by 2026, which would equate to an average subsidy of €90,000 required for each apartment.

Earlier this year, figures provided by Minister for Housing James Browne in response to a parliamentary question from Sinn Féin’s Eoin Ó Broin showed that the 2,662 apartments approved under the scheme have required an average subsidy of €120,000 each.