Two of the country's leading property developers are offering home buyers interest-free loans in an attempt to stimulate activity in the housing market.

Glenkerrin Homes, headed by leading developer Ray Grehan, will offer buyers loans worth 15% of the value of the property. It says this will help bridge the gap between the mortgages being offered by banks and the purchase price. The company says that, in effect, buyers will have to find only 5% of the value of the home as a deposit.

The 15% must be repaid either after seven years, or when the property is sold, whichever comes first. Glenkerrin says that if the property rises in value, it will share in the gain, but it will also take the hit if the property falls in value.

Among the Glenkerrin schemes covered by the plan - called Home Purchase Choice - are Ballintyre Hall in Dublin 14, The Grange development in Blackrock, Co Dublin, and St Edmunds, near Liffey Valley Shopping Centre.

Another developer, Bernard McNamara, is also offering interest-free loans of up to 30% at his Elm Park apartment development in Dublin, where he has already cut prices by 20%. He is trying to attract buyers for 70 of the 330 units.