People in England are being offered help to climb onto or up the housing ladder as the government's mortgage indemnity scheme launches.
Building firms and taxpayers will be co-guarantors on new homes bought by existing or first-time buyers.
The government hopes the NewBuy scheme - supported by Barclays, NatWest and Nationwide - will help people to borrow up to 95% of the value of new homes.
Critics argue the scheme is just a ruse to help the construction industry.
Under NewBuy, the builder pays 3.5% of the sale price into a special account held by the lending bank for seven years.
Taxpayers will provide additional guarantees of 5.5% but that money will be called upon only in the event of a major property crash.
The scheme is being unveiled on the same day Prime Minister David Cameron confirmed the extension of the right-to-buy discount to up to £75,000 for social housing tenants.
Under that scheme, those who have had five years in a council house could receive a 35% discount, with an extra 1% for each added year up to a maximum of £75,000.
Tenants in flats will get 50% off after five years, with 2% added yearly. The government says the cash raised from the sales will be put towards new "affordable homes for rent".
Mr Cameron said of both schemes: "Strong families and stable communities are built from good homes. That's why I want us to build more homes and I want more people to have the chance to own their own home."
He said: "We're rebooting the right-to-buy scheme to increase discounts for two million tenants in social housing in England. And we're delivering on our promise to offer affordable mortgages to buyers who might otherwise not be able to raise the money to buy a newly built home."
He added: "It's no good hoping people will climb the property ladder if the bottom rung is missing."
NewBuy is backed by the Home Builders' Federation (HBF) and the Council of Mortgage Lenders and seven construction firms - Barratt, Bellway, Bovis, Linden Homes. Persimmon, Redrow and Taylor Wimpey.
The scheme is available on flats and houses up to a maximum value of £500,000 in England only.
The Department of Communities and Local Governmentsays the NewBuy schemewill enable banks or building societies to lend up to 95% of the sale price - meaning buyers might only have to provide a £10,000 deposit on a newly built £200,000 home.
'Questions to answer'
Housing Minister Grant Shapps said the average age of first-time buyers had risen dramatically as people could not afford deposits.
"I'm not prepared to stand by, and nor is the government, to watch an entire generation of people be locked out of the housing market when they can afford proper mortgages," he said.
Stewart Baseley, executive chairman of the HBF, said: "NewBuy will help thousands of people to meet their aspirations to buy a new home, freeing up the housing market and helping first-time buyers and those unable to take the next step on the ladder.
"The scheme will also provide a vital kick-start for house builders large and small who will be able to build the homes and create the jobs that the country desperately needs."
The construction industry hopes the plan will lead to an extra 100,000 properties being built, which it says would create 500,000 jobs.
For Labour, shadow housing minister Jack Dromey said: "There are questions to answer about this scheme. Why has the number of major lenders participating in the scheme fallen from seven to three and the number of builders from 25 to seven compared with when this scheme was originally announced?
"Reports have also suggested that few, if any, mortgage products will be available straight away and that the interest rates might not be attractive to would-be buyers.
"It would be absolutely wrong for the government to raise the expectations of families and young couples only for them to find little choice and that they're unaffordable."
Other criticisms levelled at NewBuy are that it is just a ruse to help the construction industry and that the government is artificially meddling in the housing market and postponing a future fall in house prices.
And Shelter's chief executive Campbell Robb said: "This strategy also does almost nothing to help the growing number of families living in insecure private rented housing with hardly any protection from rogue landlords or unexpected rises in rent."
Earlier this month the HBF said the number of new homes getting planning permission in England had fallen to a five-year low.
A Council of Mortgage Lenders spokesman said: "There is lender support and interest in the scheme. This is part of a wider approach to stimulating demand in the economy and it is part of a growth package and a series of measures."
One of Britain's biggest housebuilders, Barratt Homes, said 20,000 people had already registered for more information about the scheme.