Octopus Investments has entered into a deal with Wates Living Space to deliver its first major 'affordable' housing development scheme.

The UK fund management company has joined up with 'affordable' housing developer QSH.

It will deliver thousands of homes using a financial model that requires little or no government subsidy.

Octopus QSH has now selected Wates to deliver its first scheme in Doncaster

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The Martindale development includes 106 two, three and four bedroom houses available through QSH-rent-to-buy.

Under the scheme, half of tenants' rental payments, set at 'affordable' levels, are put towards the deposits they need to secure a mortgage to buy their home.

Mario Berti, head of the specialist finance team at Octopus, said: "There is a chronic shortage of affordable housing in the UK which presents a huge opportunity for Octopus QSH.

"The government desperately needs to create more homes in order to meet its policy objectives and we will be providing innovative solutions to local authorities and housing associations to help solve this problem."

(LM/CD)