Just 455 home loans have been approved under a Government scheme set up to help first-time buyers access cheap credit.
The Rebuilding Ireland Home Loan was announced amid huge fanfare at the start of the year – but so far just five buyers have actually drawn down money.
Those mortgages were issued in just two counties.
The special loans, which come with reduced interest rates of 2-2.3pc, are for couples earning less than €75,000.
Homebuyers can borrow up to 90pc of the value of a property in the knowledge their mortgage repayments will remain the same for up to 30 years.
At the launch, Housing Minister Eoghan Murphy said home ownership was “an important aspiration in a Republic of Opportunity”.
But Fianna Fáil’s housing spokesman Darragh O’Brien said the figures revealed today prove the Government “is completely failing on affordability”.
To date, the Housing Agency has received a total of 1,499 applications for assessment from local authorities. Some 1,150 were deemed to be valid.
Of these valid applications, only 876 have been assessed and 421 (48pc) were rejected.
The process for drawing down funds also appears slow with just five loans worth €755,000 in total issued to date. These were in Meath and Wexford.
Mr O’Brien told the Irish Independent: “Four months on from the roll out of this scheme, the take up and approval rate is already very worrying. There is a clear trend of applications been out-rightly rejected or refused.
“A one-in-three approval rate for such a restricted loan system is very low.
“Fine Gael is claiming the scheme is ‘a success story’ but with only 455 applicants benefiting, it is a drop in the ocean against a rising tide of house prices.”
To qualify for the cheap loans, a single person has to have an income of less than €50,000. The cap is set at €75,000 for a couple.
They must also provide evidence of refusal or insufficient offers of finance from two banks or building societies.
The value of a property being bought is limited to €320,000 in Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow. For the rest of the country the house must cost less than €250,000.
Of the 1,499 applications received to the end of May, 619 were from the four Dublin local authorities, while 540 were from the local authorities in Cork, Galway, Kildare, Louth, Meath and Wicklow.
The remaining 340 applications were from the other local authorities where the lower purchase price limit applies.
Mr O’Brien claimed there has not been “an affordable home built since 2011 and while house prices continue to rise, the Government’s loan scheme is refusing the majority of the applicants trying to buy them”.
However, a spokesperson for Mr Murphy said the fact 48pc of valid applications have not been accepted “is testament to the need for robust analysis of people’s ability to borrow and repay”. He said: “The last thing we need is a whole raft of non-performing loans.”