Chancellor George Osborne is expected to deliver a significant boost to the hard-hit property and construction industries in his budget today.

It is thought that chancellor has plans to introduce a £250 million scheme to help first-time buyers, as well as relaxing planning laws to assist property developers.

The scheme, which is expected to benefit around 10,000 potential homeowners, will give first-time buyers the chance of taking up a five-year, interest-free loan of up to 80 per cent of the deposit.

The loans, which will have a low interest rate at the end of the five-year period, will only be applicable to individuals or couples together earning less than £60,000 and be looking to purchase a newly built flat or house.

On the planning side, it is anticipated that Osborne will permit property developers to convert commercial property into private dwelling without planning permissions.

Alan Waxman, chief executive and founder of residential developer Landmass, said these plans will ease the pressure on the high demand for residential property but may not produce the results the government anticipates.  

He argued, ‘The point of easing planning regulations for developing commercial properties into private homes will only make a small impact, particularly as supply has not been able to cater for demand for several decades.’