The Government plans to cut the cost of new homes by a third for first-time buyers to try to get more people on the housing ladder.
The ‘First Homes’ scheme will also give people the opportunity to buy a home in their local area.
Ministers claim it will save first-time buyers on average around £100,000, as it will lower deposit and mortgage requirements.
The discount will be prioritised for veterans and key workers such as nurses, police officers and firefighters.
And it would passed on when the property is sold in future.
But Labour accused the Government of giving “yet another empty promise” on housing.
In 2014 the Tories promised to create 200,000 new homes in England for first-time buyers – but zero homes were built.
Shadow housing secretary John Healey said: “We’ve heard this all before.
“Conservative ministers previously pledged to build 200,000 cut-price homes for first-time buyers, but the National Audit Office has confirmed they haven’t built a single one, despite wasting almost five years and spending millions of pounds.”
The number of home-owning households aged under 45 has fallen by 800,000 since 2010.
The scheme will apply the discount in perpetuity, so when the home is sold in the coming years the new local buyer will be able to purchase it at a discount as well.
The Government said the discount will apply to “a proportion” of new homes, and the consultation will look at how this will be delivered.
Veterans will be prioritised as part of the Armed Forces Covenant and councils will also be able to use the scheme for frontline workers in their area such as police, nurses, prison officers and teachers.
Housing Secretary Robert Jenrick said: “First Homes will be genuinely life-changing for people all over the country looking to buy their first home.
“I know that many who are seeking to buy their own home in their local areas have been forced out due to rising prices.
“A proportion of new homes will be made available at a 30% market discount rate – turning the dial on the dream of home ownership.
“The discount will be passed on with the sale of the property to future first-time buyers , helping thousands more people in years to come and ensuring local communities can stick together.”
