The newspapers might be full of doom and gloom but the credit crunch and general economic downturn has to be good news for someone. Despite the stories about first time buyers being forced out of the market by banks refusing them large mortgages, the housing recession poses a great opportunity for those wishing to get their first foot on the ladder.

The government has announced a package to help first time home buyers and those struggling to pay their mortgage. It has suspended stamp duty for houses sold for 175, 000 pounds and under. It also announced HomeBuy Direct scheme allowing those with low incomes to sell a share of their home and rent it back.

With the financial turmoil and rising food and petrol prices, many home owners are facing repossession or the possibility of approaching home purchases to buy their home and rent it back to them. The new government scheme allows those who might otherwise have their houses repossessed to keep up with payments without having to surrender their home.

Those struggling to keep up with mortgage repayments and facing repossession can sell their home to a registered social landlord (RSL) who will pay off the mortgage and then rent the property back to the occupants at a level which is affordable.

In some cases, the RSL could purchase a portion of the property, or provide an equity loan which could help to reduce the homeowners mortgage repayments. This is similar to many Buy and Rent Back schemes offered by many private companies.

The new HomeBuy Direct scheme allows first-time home buyers with a household income under 60, 000 pounds to buy newly-built properties with a free equity loan of up to 30% of the property's value.

A spokeswoman said "We welcome the Government's stamp duty initiative. This is a sensible measure and it will help the housing market" on behalf of Halifax. The Treasury has estimated that the one-year stamp duty freeze will cost the Government 600 million pounds.

Around half of the 90, 000 home purchases made each month are on houses worth 175 thousand pounds or less, but deals below 125 thousand are exempt from stamp duty anyway.

It seems that the government has finally stopped dithering and is committed to helping first time buyers and the market as a whole. House prices are falling, but their value at the beginning of the year was probably inflated, so they still probably have a way to fall.