Right-to-buy discounts up to £75,000 offered

The larger-than-expected extension will encourage “strong families and stable communities”, according to the Prime Minister.

Those who have five years’ residency could receive a 35 per cent discount, with an extra 1 per cent for each added year up to a maximum of £75,000.

Tenants in flats will get 50 per cent off after five years, with 2 per cent added yearly.

Previously it was thought discounts would be limited to £50,000.

The money raised from sales will go towards building more social housing.

The Government is also announcing more details of its NewBuy Guarantee, designed to give would-be buyers access to mortgages even if they only have a 5 per cent deposit.

Names are being released of three high-street lenders and seven construction firms who have agreed to support the scheme.

Ministers say they believe the initiative will help 100,000 people who would otherwise have been frozen out of the property market, and support 50,000 construction jobs.

Mr Cameron said: “Strong families and stable communities are built from good homes. That’s why I want us to build more homes and I want more people to have the chance to own their own home.

“We’re rebooting the right-to-buy scheme to increase discounts for two million tenants in social housing in England. And we’re delivering on our promise to offer affordable mortgages to buyers who might otherwise not be able to raise the money to buy a newly built home.”