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 , external , 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…