The Government has set aside a total of £36m to help developers build homes for first-time buyers on brownfield sites.

Communities secretary Greg Clark yesterday announced the launch of a £26m fund which will help architects, developers, councils and housing associations to purchase brownfield land on which to build starter homes which will be offered exclusively to first-time buyers under the age of 40 with a discount of 20% on market values.

Clark also made available a further £10m to help local authorities prepare identified brownfield sites for development.

Yesterday the British Property Federation (BPF) hailed the launch of the funds, but warned that more funding would be needed if the Starter Homes scheme is to deliver the 200,000 homes the government has promised by 2020.

Melanie Leech, chief executive of the BPF, said: “Brownfield sites often prove to be extremely lengthy and complex to develop, and if the government wants to see significant amount of housing delivered on them, then developers and house builders are going to need some help.

“The funds show welcome recognition of this fact, but we will need to see more from government if it is to reach its Starter Homes targets.”

Clark said: “This competitive fund will build homes that will clearly show the wide range of new properties that will be available for first-time buyers as they take their first step on the housing ladder.

“We are also helping bring back into use more brownfield land for development, keeping the country building and delivering the homes our communities need.”

Andy Rose, chief executive of the Homes and Communities Agency (HCA), said: “The HCA is ready to support the Government in delivering this key priority, which aims to set the standard for starter homes. By using our land and development expertise, we will help even more first-time buyers into affordable home ownership.

“We look forward to working with our key delivery partners including councils, developers, housing associations, small builders and architects in taking this forward, through the identification and purchase of land suitable for exemplar starter home sites.”