Earnings limit of up to £140K for first-time buyers loan scheme
New loan scheme for first-time buyers will limit eligibility to households earning under £110,000 outside London and £140,000 within the capital.
Quick Look
The UK government is set to introduce income eligibility caps for its 'Your First Home' scheme, restricting access to households earning under £110,000 outside London and £140,000 in the capital to ensure support reaches those most in need.
AI-generated summary
Why It Matters
Previous first-time buyer schemes lacked income restrictions, leading to criticism that they inflated house prices by enabling wealthier households to borrow more.
Households will need to earn less than £110,000 to qualify for the government's new loan scheme for first-time buyers, or £140,000 for homes bought in London.
As first reported by The Times, the earnings limits are expected to be confirmed at the Budget next week.
The Your First Home scheme will offer government-backed equity loans worth 20% of new-build properties in England bought from participating developers.
The loans, which will also be subject to an initial interest-free period, are designed to help people buy a home with deposits as low as 2.5%.
Previous schemes to help first-time buyers did not restrict eligibility by income but faced criticism for stoking house prices by allowing relatively wealthy households to borrow more.
Unveiling the Your First Home Scheme at last month's Labour conference, Prime Minister Andy Burnham said it would focus on those who "really need support".
Details of the changes, including salary caps, are due to be confirmed at next week's Budget.
The Times reported that ministers had initially decided to set the earnings limits at £90,000 for homes outside London and £110,000 in the capital, before concluding this would deny access to too many middle-earning couples, such as teachers and nurses.
What to Watch
AI outlook — possibilities, not facts
Official confirmation of income caps at next week's Budget.
Very likely · Within days
Open Questions
- Will the interest-free period duration be announced at the Budget?
- Are there specific regional variations beyond London?
