Sinn Féin claims the 'damage has already been done' amid reports that the 'help-to-buy' scheme for first-time property buyers could be scrapped.

It comes after the Sunday Independent reported that the new Housing Minister Eoghan Murphy is "actively considering doing away with the grant".

During the Fine Gael leadership campaign, Leo Varadkar indicated that the scheme would be reviewed if he became Taoiseach, and potentially phased out if was found to have an "inflationary effect" on house prices.

It will come as part of a wider review of the Government's 'Rebuilding Ireland' housing strategy.

The scheme, introduced in the last budget, allows for a rebate of up to €20,000 for those buying or building a home for the first time.

The incentive applies to properties that cost €500,000 or less.

Some commentators have raised concerns that the incentive - which is currently scheduled to remain in place until 2019 - is driving up house prices.

Housing Minister Eoghan Murphy. Image: RollingNews.ie

Minister Murphy today told RTÉ he is concerned that the scheme could be inflationary, adding that the review will now be carried out.

Meanwhile, Sinn Féin's finance spokesperson Pearse Doherty said in a statement: “While I welcome reports suggesting that this scheme is to be axed in the upcoming budget the reality is that the damage has already been done and can be seen in the dramatic increase in house prices. 

“What we need to see now is a real effort to tackle the supply and affordability issues. That must be led by major investment in building social housing.”