Working in a joint venture called Matrix Homes, Wates Living Space will build homes on five sites with finance coming from the Greater Manchester Pension Fund.

Under the plan, the city council is releasing land into the joint venture at fair market valuation, while the council pension fund injects £25m for building work.

Both partners will then receive a capital payment on the sale of houses and an annual revenue return.

Matrix Homes includes GVA, which is providing technical advice, Plumlife, which will be responsible for sale and marketing the properties; and Places for People who will act as agent and manage the rental properties.

Works on the first sites will begin in May. The new homes will be built in Chorlton-cum-Hardy, Gorton and Brooklands and be split between affordable and private sale.

Cllr Nigel Murphy, Manchester City Council’s executive member for housing and regeneration, said: “This is a momentous day and a hugely significant milestone in what has been an innovative and ambitious approach to home building.

“Manchester’s housing investment fund is the first of its kind model to boost home building and we hope its success will lead to larger home building projects in the future.”