The offering of 30-year mortgages will be a significant way to help first-time buyers, according to Mr Harry Lorton, the TSB chief executive and president of the Institute of Bankers.

Mr Lorton predicted that, in a year or two, such mortgages would be commonplace. He said spreading the mortgage term over a longer period would mean that monthly repayments would be significantly reduced, giving first-time buyers a better chance of affording them.

He believed people were not as eager as before to move house and were more willing to take on a longer-term mortgage.

Typical mortgages are currently spread over 20 or 25 years by most lenders.