First-time buyers are to get a helping hand from the Government to buy their own homes.

Chancellor George Osborne yesterday announced a £250 million scheme, called First Buy, that will help people amass the 25 per cent deposit needed to enable them to get a mortgage.

The scheme will be open to people who have a household income of less than £60,000 a year who want to buy a new-build home.

The Government and the housebuilder will each loan the buyer 10 per cent at a low rate of interest.

The buyer themselves will have to find the remaining five per cent.

The Government's share of the money will come from a tax on banks.

The initiative replaces Labour's Homebuy Direct scheme, which was withdrawn last autumn.

Paul Gibson, 22, a cabaret artist from Wigston, has been trying to get on the property ladder for about 18 months with a friend but has so far struggled to stump up the deposit.

He said the First Buy scheme was "great news".

"Finding the money for a deposit is so difficult, and anything that helps is a bonus," said Paul.

"I don't think it takes away the anxiety of buying a house because after all it's still a lot of money, but it certainly opens doors and makes the search easier. The new builds are ideal as they tend to be more energy efficient and in a nicer area – it's great that we might be able to get that kind of house."

Ian Jones, business developments director at property company Westleigh Developments, which has 200 staff in the East Midlands, including 50 at its Whetstone head office, gave the news a more cautious welcome.

He said: "This is a good move but it will help just 10,000 first-time buyers nationally get a foot on the property ladder. This scheme by itself will not kick-start the first-time buyer market into action.

"However, as always with announcements like these, the devil will be in the detail and it will be interesting to see how exactly these changes are implemented in the coming weeks."

Gary Brebner, chief executive of the Loughborough Building Society, said: "Anything that helps first-time buyers is good. The caveat is that this scheme only applies to new-build properties."

He said that if the Government had included older homes it "might not have helped the building trade, but would have applied to a higher number of properties".

The previous Homebuy Direct scheme saw the Government and developers each loan first-time buyers up to 15 per cent of the purchase price of a new-build property.