For the first time since the credit crunch struck, first time buyers can now get a mortgage with a 10% deposit. For some two years now, lenders have run scared of high loan-to-value mortgages as house prices fell away. But as prices begin to stabilise, lenders are re-entering the market.

Industry research shows that 21 lenders will now consider low deposit mortgages – although that’s a mere fraction of the number during the property boom years. (HSBC, NatWest, Yorkshire bank and Britannia seem the best)

Nevertheless it’s great news for first time buyers.

But as with all these things, there’s a sting in the tail. The cost of these low deposit loans is high. The average rate charged is close to 6.25% - that’s 5.75% over the Bank of England’s base rate for a 2 year fixed rate.

Before you dash out, consider what could happen when the fix comes off in two years time. Say you took one of these loans and base rate increased significantly during the next 2 years (as it most certainly will). Despite what optimists are saying we remain very worried about house prices and say we are right. What could happen in two years when the mortgage fix comes off?

Well, if the housing market remained down in the dumps you would probably have equity in your home of between 5% to 15%. At the lower end you’d be forced to stay with your lender and accept their standard variable rate. At the higher end you’d have enough to go mortgage shopping for a new fixed rate deal. But it’s touch and go.

Now add the scenario is that prices do continue to fall albeit at a slower pace, and you also need to move, say with your job. As you started with just 10% in your home you’d be lucky to clear that to put down as a deposit on your next home and that would mean that your next home would be rented. Your back to saving up again.

I know that some people will criticise me, but I think it is too soon to go for a 10% mortgage bearing in mind that interest rates are going to rise and the direction of the housing market is by no means clear. I’m not the only one that believes that the current upward movement in house sales and prices is a false dawn. The market still has lots of problems to face and lots to prove.