Director general Paul Smee urged the Chancellor to be clear on what he hopes to achieve with any proposals.

Smee said: “My main plea is for the Chancellor to articulate very clearly what any proposals in his budget are designed to deliver.”

He continued: “Is there a general economic objective of stimulating activity – in which case the emphasis should be on construction of new homes? Or is the desired primary objective to promote home ownership, with increased economic activity seen as a secondary by-product of that? The two objectives may be equally legitimate for Government, but the means of attaining them are very different.”

A mixed message which confuses the two, or tries to blend one mechanism to deliver two different outcomes is unlikely to deliver an effective policy prescription, he said.

Smee also saluted the market’s ability to self-heal and said: “And I believe that we are seeing good progress towards self-healing under way now.”

He added, in what he called his Factoid of the Month, that the lending industry gives a mortgage to a first time buyer every three minutes, adding (three minutes, not three hours, not three days).

“You can see why our overall forecasts are on the up,” he said.