Plans to introduce 5,000 affordable homes across England by 2020 have been unveiled today in a new rent-to-own housing model.

Housing company Rentplus have created the model with the financial backing of private and institutional investors, with the first agreements to produce 900 new homes being approved by Plymouth City Council and Sedgemoor District Council.

The company is currently closing the first £70m of institutional funding as part of an overall plan to raise £600m – £700m of institutional investment over the next five years.

Rentplus brings together local authorities, national and regional house builders, developers and housing associations in a partnership to build much-needed new affordable homes to help tackle the nation's housing crisis.

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Working with local housing associations, the company is to provide new purpose built homes available at affordable rents for an agreed period of between 5 and 20 years.

Tenants will be given the opportunity to purchase their property at the end of their rental agreement. They will also receive a ten per cent gifted deposit from Rentplus to help their mortgage application, although tenants will not be obliged to buy.

Rentplus Chief Executive, Richard Connolly, said: "We are delighted to launch Rentplus and to announce the first large scale agreements with Plymouth City Council and Sedgemoor District Council to commence the delivery of 500 new affordable homes in Plymouth and 400 across Sedgemoor. Rentplus offers the best of affordable renting and home ownership rolled into one. It will give many people the opportunity to own their own home for the first time and will enable local authorities to increase the affordable housing stock and reduce housing waiting lists."

The first development of 29 properties at Mannamead in Plymouth is due to begin construction in April 2015. Tamar Housing Society, the leading housing association in Rentplus' consortium in the South West, will manage the Rentplus properties in Plymouth.

(LM/CD)