A dielectric template layer is deposited on a substrate. Line trenches are formed within the dielectric template layer by an anisotropic etch that employs a patterned mask layer. The patterned mask layer can be a patterned photoresist layer, or a patterned hard mask layer that is formed by other image transfer methods. A lower portion of each line trench is filled with an epitaxial rare-earth oxide material by a selective rare-earth oxide epitaxy process. An upper portion of each line trench is filled with an epitaxial semiconductor material by a selective semiconductor epitaxy process. The dielectric template layer is recessed to form a dielectric material layer that provides lateral electrical isolation among fin structures, each of which includes a stack of a rare-earth oxide fin portion and a semiconductor fin portion.