The Independent Alliance wants the 'granny flat grant' to deliver payments of up to €15,000 to homeowners who want to convert their homes into two units.
That's despite experts estimating the cost at up to €50,000.
The proposed grant would see payments to 'empty-nesters' to allow the upstairs of their home to be converted into a separate rental unit.
The suggestion has met with a mixed reaction, amid calls for greater detail on how the scheme would work.
Pressed on the matter, Independent Alliance minister Finian McGrath said Finance Minister Paschal Donohoe was costing all of their proposals. He said would see the home conversion grant as being in the region of €10,000 to €15,000 and that he envisaged the sum as being similar to that on offer for housing adaptation grants for people with disabilities.
When put to him that some estimates put the cost of converting a house into two properties at €50,000, he said the Independent Alliance isn't talking about knocking down or fully renovating a house. He insisted the kind of conversions being suggested would cost around €15,000 and in some cases less.
Mr McGrath said the grant level was a matter for Budget negotiations and was "not set in stone". He claimed that critics of the proposal were "lacking creative ideas in relation to housing".
Mr McGrath said the alliance had researched the idea and said it would be "good for society, good for older people and good for anyone waiting to move into a house".
Asked if he believed the proposal will be adopted in the Budget, Mr McGrath said it was among several ideas the Independent Alliance has put on the table.
"He's going to come back to us with some of the costings and figures. We'll decide which we'll go for. It's just an idea. It's a creative idea, it's something different. No final decisions have been made."
Mr McGrath was speaking after the launch of a Debra Ireland report on identifying the optimum role and function of an outreach nurse who works with people suffering from Epidermolysis Bullosa (EB).
Meanwhile, a spokesman for advocacy group Age Action said: "We're giving it a cautious welcome in the sense that if it helps older people to downsize and the older person knows what they're getting into then yes it has advantages, but we'd need more detail on the proposals before we could say whether it's a good idea," he said.
But Fianna Fáil's Dara Calleary dismissed the idea as a "kite".