Pepper Money has returned to Downing Street to deliver new research supporting a review of the shared ownership income caps.
The lender’s white paper builds on research and policy recommendations presented to No.10 last year. Authored by economist Rob Thomas, it examines whether shared ownership eligibility has kept pace with the financial circumstances of aspiring homeowners.
The paper brings together data from MHCLG, the ONS, UK Finance, the Land Registry and the FCA, alongside a survey conducted last month of 1,000 English households that have not yet bought a property and earn above the shared ownership income caps. The analysis examines changing affordability pressures, the profile of shared ownership buyers and whether current eligibility limits reflect the modern financial realities of aspiring homeowners.
The report finds that house prices rose by 37% and earnings by 42% between 2016 and 2025, while shared ownership’s household income caps remained fixed at £80,000 outside London and £90,000 in the capital. Meanwhile, one in ten non-homeowners earning more than these income caps had previously tried to access shared ownership but been told they were ineligible. Two thirds would consider purchasing through the scheme if the caps were raised to include them.
The findings come as the government develops its newly announced Your First Home scheme, which is expected to offer eligible first-time buyers a 20% government-backed equity loan towards an eligible new-build home, with a minimum deposit of 2.5%. Its household income cap and local property price caps are due to be confirmed at the Budget.
The dual-income gap
Pepper Money’s latest white paper examines ten key-worker occupational groups that together employ 2.9 million people. Its findings illustrate how the shared ownership household income limits can exclude couples performing essential roles, even where deposit requirements, local house prices, childcare costs and other commitments still prevent them from buying a suitable home.
In seven of the ten occupational groups examined, two full-time employees in the same occupation, each earning its median salary, would exceed the shared ownership income caps both outside London and in the capital. For example, two teaching professionals would earn approximately £95,000 combined nationally, while equivalent couples working as nursing practitioners or paramedics would earn approximately £92,100 and £107,600 respectively.
Among all those surveyed, more than half (58%) live in privately rented accommodation, spending an average of around a third of their monthly take-home income on rent. One in five said that even with both incomes, they were unable to buy a suitable home on the open market.
The report also shows that shared ownership is increasingly supporting older buyers. Purchasers aged 50 or over accounted for 18% of shared ownership purchases in 2024–25, compared with 5% in 2003–04.
Among surveyed respondents aged 45–54, 74% feared they were running out of time to qualify for a suitable mortgage. Among those aged 55–64, 46% believed their age and the shorter mortgage term available could make securing a mortgage difficult.
Rob Barnard, intermediary relationship director at Pepper Money, said: “Last year, our white paper demonstrated the vital role shared ownership plays in helping people onto the housing ladder. This year, we have returned to Downing Street with new evidence on how the tenure needs to evolve so it can continue supporting people who would otherwise struggle to buy a home.
“The housing market has moved on, but the income caps are still stuck in 2016. Many households now earn too much to qualify, yet lack the deposit or borrowing capacity to buy a suitable home on the open market. Our research shows that this gap can affect couples in essential professions, including teachers, nurses and paramedics, even when both earn the median salary for their role.
“Your First Home has the potential to help more people onto the housing ladder. As the government develops its eligibility rules, there is also an opportunity to consider whether existing routes onto the housing ladder continue to reflect today’s financial realities.
The aspiration to own a home does not expire at 50. Shared ownership is increasingly supporting older buyers whose earnings may have progressed, but who still face barriers to purchasing a home.
“Building more homes and helping people afford them must go hand in hand. That requires suitable properties, workable eligibility rules and access to appropriate mortgages.
“The appetite is there: two thirds of the households we surveyed would consider shared ownership if the caps were raised to include them. Reviewing those caps is a practical starting point for government and the sector to work together, alongside ensuring buyers can access finance that responsibly reflects their circumstances."
