Aspiring home owners will be asked to register their interest in buying via the Starter Home initiative from the start of next year.
And many of the country’s leading house builders and councils are already looking at sites that could be used for new homes.
The scheme will benefit from a change to the planning system to free up under-used or unviable brownfield land from planning costs and levies in return for a below market value sale price on the homes built on the site.
Developers and councils are being asked to respond to the proposals to ensure the changes will unlock a range of sites across the country.
And 100,000 homes are set to be made available to first-time buyers under 40 as part of the initiative with work on the first raft set to start next year.
Prime Minister David Cameron said: “Hardworking young people want to plan for the future and enjoy the security of being able to own their own home. I want to help them do just that.
“Under this scheme, first-time buyers will be offered the chance of a 20% discount, unlocking home ownership for a generation.
“This is all part of our long-term economic plan to secure a better future for Britain, making sure we are backing those who work hard and get on in life.”
And Stewart Baseley, executive chairman of the Home Builders Federation, heaped praise on the initiative.
He said: “Increasing housing supply is a huge and complex challenge and significant barriers remain.
“Bringing forward more land for house building, while also enabling more first-time buyers to realise their ambition of home ownership would be another positive step on the way to tackling the housing shortage.
“The industry is keen to work with government to develop policies that would allow for more high quality homes to be built in the right places.”