The government has confirmed it will raise the income caps for shared ownership homes in the new year to allow more buyers to qualify.

Housing minister Matthew Pennycook told Parliament yesterday that the upper limits on annual household income for shared ownership schemes outside the capital will increase from £80,000 to £90,000.

Within London, the cap will rise from £90,000 to £110,000.

Housing associations and other stakeholders have been calling for the limits to be upgraded as they have remained unchanged for a decade, despite inflation.

Pepper Money was among those to campaign for the increase.

Intermediary relationship director Rob Barnard says: “This is a welcome and sensible decision.

“The shared ownership income caps had been frozen since 2016, while house prices rose by 37% and earnings by 42%.

“That left a growing number of working households earning too much to qualify, yet still unable to buy a suitable home on the open market.

“Earlier this month we returned to Downing Street with our white paper, Sustaining the Development of Shared Ownership, which called for the caps to be reviewed.

“Our research found that one in ten non-homeowners earning above the caps had already tried to use shared ownership and been told they were ineligible.

“Raising the caps opens the door to many of those households, but it needs to be reviewed regularly.

“This is an important step, but there is more to do.

“We’ll continue to engage with government and policymakers, using the evidence and experiences of customers and brokers to raise the issues that can help make shared ownership work better.

“With more detail on Your First Home expected in tomorrow’s Budget, the same principle applies.

“Eligibility rules need to reflect what people actually earn and what homes actually cost today.”