Talk of rising enquiries from first home buyers has not translated into sales, new data suggests.

Loan Market recently claimed a 10% spike in enquiries from first home buyers in June. However, a study by comparison site RateCity has indicated 60,000 fewer first home buyers entered the property market in the 12 months to May 2011 than in the 12 months to May 2010. RateCity CEO Damian Smith said ABS figures showed around 7,500 first time buyers per month active in the market in the 12 months to May. This compares with around 12,500 per month in the previous corresponding period. Smith claimed that, with property prices largely flat over the past year, interest rate rises and the winding up of the FHOG Boost were behind the drop-off.

"Despite the Reserve Bank boards' decision to keep rates steady for the past seven meetings, it's clear that prospective buyers are still wary about jumping into debt because their monthly repayments are going to be much, much higher than they were in late 2009," Smith said.

While the end of the FHOG Boost may have taken many prospective first time buyers out of the market, Smith said reviving the boost would be counter-productive.

"The answer is not to introduce further grants to stimulate growth in the first home buyer market. Historically, grants doled out to new buyers have tended to increase property prices without increasing the supply of new housing," he said.

Rather, Smith said the answer to stimulating first home buyer activity was increasing incentives for prospective buyers to save for a deposit. He called for restrictions on the government's First Home Saver Account Scheme to be eased.

"First home saver accounts continue to be overly complex, and as a result most prospective home buyers are unaware of the generous rates of interest offered by these types of accounts," Smith commented.