The chief economic adviser to the mayor of London has issued a warning over the government’s Help to Buy scheme, claiming it is giving prospective homeowners a false impression of the housing market.

According to the Telegraph, Gerard Lyons said that the initiative, designed to give many people a chance of getting on the property ladder, is causing a “lethal combination” of high expectations and cheap money – creating the impression that rising prices are a “one way bet”.

Mr Lyons also compared the scheme to the crisis suffered by Northern Rock, saying that it risked exposing the UK to the same elements that led to the collapse of the bank.

He added: “We need to learn some lessons from the crisis and one of those is we should become less obsessed with the housing market driving the economy.”

The economic adviser has joined a growing list of critics of Help to Buy, with the main argument seemingly being based around concerns that supply will not be able to keep up with demand.

Around 80,000 loans have been approved under the initiative since it was first rolled out in April.