Anthony Albanese has brushed off suggestions a scheme designed to help more young Australians buy a home could drive up property prices.

Labor's five per cent deposit scheme took effect on Wednesday, allowing eligible first-home buyers to get a mortgage with a much smaller deposit and avoid paying for lenders' mortgage insurance.

Some analysts argue the measure will add demand to an already-hot property market.

The Insurance Council has previously claimed it could push up the cost of a home by as much as 10 per cent in the first year alone.

Treasury modelling suggests the impact will be much smaller at just 0.5 per cent over six years.

The prime minister argues the scheme, which was a campaign promise, will level the playing field between first-home buyers and investors.

"What that w

See Full Page