Defaqto says the government hopes the scheme will provide a level of confidence elsewhere.
David Black, principal consultant for banking at Defaqto, says: “For the 10,000 first-time buyers who get the five-year interest free loan it will enable them to jump onto the housing market.
“The great imponderable for them though is what will happen to house prices – will they stabilise or continue to fall?
“On the other hand there is also a convincing argument to say that the interests of first time buyers would be best served by cheaper houses.”
Black says the concern continues to be those recent purchasers who can afford their mortgage payments but have entered negative equity with a property now worth less than the mortgage.
He says: “They will find it virtually impossible to move until the market has picked up substantially.”