A Cabinet minister says it is worth risking higher property prices in order to help out first-time buyers.
Under Budget 2017, they will be entitled to a 5% grant on newly built homes up to the value of €20,000.
It has prompted concerns that developers will put up the prices of new builds in response, rather than increasing housing supply.
Minister for Social Protection, Leo Varadkar, thinks the benefit of the scheme will outweigh any problem.
He said: "It is a risk, it's a risk if supply doesn't increase, but sometimes you have to take risks to change the environment and change the landscape that is out there.
"We believe it is a risk that will pay off because it will generate much more supply."