First home grants brought in to ease stress from the housing crisis - could be creating problems.

Ministers have been told their $10,000 Homestart grant scheme for first home buyers could be pushing up house prices, because sellers see more money going around.

But CEO of Generation Homes Kevin Atkinson told Mike Hosking in his experience of building homes, they've reduced house prices.

"If you have got someone who has that $10,000 and it's important to them, generally they are sitting around the table with the builder and they are trying to make it work."

Atkinson says the money is such a minuscule amount it doesn't make a difference.

"To suggest that a seller is sitting there saying, 'because someone might have a $10,000 home grant, I am going to put the price up at the auction,' it just doesn't exist."

LISTEN ABOVE AS KEVIN ATKINSON SPEAKS WITH MIKE HOSKING