The Help to Buy London scheme is launching today, with lenders competing for business;

The Government is offering to back buyers of new-build properties worth up to £600,000 in the capital with an equity loan of up to 40% with the rest made up of a 5% borrower deposit and a mortgage.

Leeds and Nationwide building societies are among the first to launch products, while Barclays has also launched new rates.

Barclays is offering a two-year fixed rate at 1.55% with a £999 fee or 1.85% with no fee.

Longer-term borrowers can also get a five-year fix at 2.19% with a £999 fee or a fee-free 2.49% deal.

These are currently the lowest deals available for Help to Buy London deals.

Leeds is today launching a two-year fixed rate mortgage at 1.79% with a £799 fee and a five-year fixed rate at 2.45% with a £199 fee.

Nationwide has revamped its shared equity products, which includes both Help to Buy London and the wider equity loan schemes.

It is offering a two-year fix at 1.89% with a £999 fee or 2.29% with no fee at 60% loan-to-value.

Or at 75% LTV, there is a two-year fixed rate at 1.99% with a £999 fee and 2.39% with no fee.

The building society is also offering five-year fixed rates at 2.64% up to 60% LTV with a £999 fee or a fee-free deal at 2.84%.

At 75% LTV, rates start at 2.74% with a £999 fee and 2.94% with no fee.

All Nationwide applicants can get a fee-free standard valuation, plus £250 cashback if they have a Nationwide Flex main current account.

The Help to Buy London scheme is an extension of the Help to Buy Equity loan scheme launched in 2013.

The aim is to boost the housing market by providing loans to boost a borrower’s deposit.

Outside London, borrowers can boost their 5% deposit with an equity loan of up to 20%, effectively boosting their overall amount to put down to 25%.

As nice as this all sounds, the average property price in London is £506,724, according to the Land Registry. So buyers will still need to find a hefty £25,336 for the 5% deposit.

Home buyers also have government-backed options such as the Help to Buy mortgage guarantee scheme and the Help to Buy Isa which provides support a government bonus to save for a deposit.