First-time buyer loan scheme to set earnings limits of £110,000 and £140,000 in London

Your First Home equity loans expected to target middle earners ahead of Budget

By LineZotpaper

Published23 October 2026

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The government is expected to allow households earning up to £110,000, or £140,000 in London, to apply for its new first-time buyer loan scheme in England, with details due to be confirmed at next week's Budget.

The government is expected to allow households earning up to £110,000, or £140,000 in London, to apply for its Your First Home scheme, according to reports first published by The Times.

The scheme will offer government-backed equity loans worth 20% of new-build properties bought from participating developers, with an initial interest-free period and deposits from as low as 2.5%. It is designed to help first-time buyers in England.

Speaking at last month's Labour conference, Prime Minister Andy Burnham said the scheme would focus on those who "really need support". The Times reported that ministers initially planned earnings limits of £90,000 outside London and £110,000 in the capital, before deciding those figures would exclude too many middle-earning couples, such as teachers and nurses.

Details of the salary caps are due to be confirmed at next week's Budget. The government has said the scheme will help boost housebuilding after ministers conceded they are set to miss a target to build 1.5 million homes in England by the next election.

The scheme resembles the coalition government's Help to Buy programme, which ran from 2013 to 2021 and offered 20% shared equity loans, interest-free for the first five years, on new homes worth up to £600,000 with 5% deposits. A second version, running from 2021 to 2023, was restricted to first-time buyers with regional price caps. Previous Help to Buy-style schemes did not restrict eligibility by income and were criticised for stoking house prices by letting relatively wealthy households borrow more.

Labour says Your First Home will be funded within existing government budgets, but has not said which areas will face spending cuts. Participating developers will be asked to contribute towards running costs.

Analysis

Why This Matters

The income caps determine whether the flagship scheme reaches the middle-earning households it is aimed at, including teachers and nurses.
The scheme is part of the government's efforts to address housing affordability and boost housebuilding ahead of the next election.
The Budget will show which existing programs are cut to fund it, making the policy a direct trade-off in public spending.

Background

The Your First Home scheme follows the Help to Buy programme introduced by the coalition government in 2013. Help to Buy used shared equity loans worth up to 20% of a new home's value, with no income limits, and was later criticised for helping wealthier buyers and pushing up prices. A second, more restricted version ran from 2021 to 2023. The new scheme is expected to introduce income caps for the first time, with higher limits in London to reflect property prices there.

Key Perspectives

The government: Prime Minister Andy Burnham says the scheme will focus on those who "really need support" and argues it will help increase housebuilding, after ministers admitted they are likely to miss the 1.5 million homes target. Middle-earning first-time buyers: Couples such as teachers and nurses are the group ministers said they did not want to exclude, prompting the decision to raise the proposed limits from £90,000 and £110,000. Critics and skeptics: Past schemes were criticised for stoking house prices by allowing relatively wealthy households to borrow more, and the higher London cap of £140,000 may draw similar concerns. There is also no detail yet on which budgets will be cut to pay for the loans.

What to Watch

The Budget next week, where the salary caps and funding arrangements will be confirmed.
Any announcement of spending cuts in other areas to finance the scheme.
The level of developer contribution to running costs, which will affect the scheme's overall budget.

Sources

Earnings limit of up to £140K for first-time buyers loan scheme · BBC News
Earnings limit of up to £140K for first-time buyers loan scheme · BBC News

Checked

12 claims in this story checked against 1 source: 10 supported.

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Partly supportedThe scheme will set earnings limits of £110,000 outside London and £140,000 in London.BBC News: “The government is expected to allow households earning up to £110,000 to apply for its new loan scheme to help first-time buyers in England. As first reported by The Times, external , a higher earnings limit of £140,000 is expected to apply to those purchasing properties in London.”
Partly supportedYour First Home is expected to target middle earners ahead of the Budget.BBC News: “The Times reported that ministers had initially decided to set the earnings limits at £90,000 for homes outside 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.”
SupportedThe government is expected to allow households earning up to £110,000 outside London and £140,000 in London to apply, with details due at next week's Budget.BBC News: “The government is expected to allow households earning up to £110,000 to apply for its new loan scheme to help first-time buyers in England. As first reported by The Times, external , a higher earnings limit of £140,000 is expected to apply to those purchasing properties in London.”
SupportedThe Times first reported the expected earnings limits.BBC News: “As first reported by The Times, external , a higher earnings limit of £140,000 is expected to apply to those purchasing properties in London.”
SupportedYour First Home will provide government-backed equity loans worth 20% of new-build properties bought from participating developers.BBC News: “The Your First Home scheme will offer government-backed equity loans worth 20% of new-build properties purchased from participating developers.”
SupportedThe loans will have an initial interest-free period and deposits can be as low as 2.5%.BBC News: “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%.”
SupportedAndy Burnham said the scheme would focus on those who “really need support”.BBC News: “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".”
SupportedThe Times reported initial limits of £90,000 outside London and £110,000 in London, later revised because they would exclude too many middle-earning couples.BBC News: “The Times reported that ministers had initially decided to set the earnings limits at £90,000 for homes outside 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.”
SupportedThe government has argued the scheme will boost housebuilding, as ministers conceded they are set to miss a target of 1.5 million homes in England by the next election.BBC News: “The government has also argued that the scheme will help to boost housebuilding, after ministers conceded they are set to miss a target to build 1.5 million homes in England by the next election.”
SupportedThe original Help to Buy scheme ran from 2013 to 2021 and offered loans of up to 20%, interest-free for five years, on homes worth up to £600,000 with 5% deposits.BBC News: “That scheme, which initially ran between 2013 and 2021, enabled all home purchasers to put down a 5% deposit on a newly built home worth up to £600,000. Up to 20% of the cost of the home was funded by a shared equity loan, which was interest-free for the first five years.”
SupportedA second Help to Buy version ran from 2021 to 2023, was restricted to first-time buyers and had regional price caps.BBC News: “A second version of that scheme, which ran from 2021 to 2023, restricted access to first-time buyers and applied regional-level price caps to the properties could be bought under the programme.”
SupportedLabour says the scheme will be funded within existing government budgets, but has not detailed which areas will face spending cuts.BBC News: “Labour has said the scheme will be funded by within existing government budgets, but is yet to provide details of which other areas will see their spending cut.”