The funding will be released in 2015 to 2016 through the Local Growth Fund being targeted at kick-starting stalled housing projects of between 250 and 1,499 homes.
A prospectus published today by the government sets out how to apply for support.
The fresh funding pot is on top of the £1bn Large Sites Fund launched earlier this month, which is being targeted at housing schemes over 1,500 homes.
It is hoped this larger cash pot will seed the development of garden city schemes.
Both funding pots are expected to support construction of up to 250,000 new homes between 2015 and 2020.
The new schemes are based on the current Local Infrastructure Fund, which is helping to accelerate development of 80,000 homes in areas such as Cranbrook in Devon, and Wokingham in Berkshire.
Housing Minister Kris Hopkins said: “We’re doing all we can to get the country building, and provide developers with a chance to get on site and start building local housing schemes that are vital for supporting local economic growth.
“Today’s £50m fund will help deliver the infrastructure local communities need to support new homes, and comes on top of the £1bn we’re making available to unlock large-scale sites that stalled at the end of the unsustainable housing boom.
“This substantial investment will lead to thousands of new homes across the country, and deliver new career opportunities in the growing construction industry.”
Last year the government committed to work with Local Enterprise Partnerships to agree local growth deals and introduced the Local Growth Fund to provide the levers to do this.
The Government hopes local leaders will be able to use their knowledge to identify local priorities, and provide investment for infrastructure that will help drive forward housing schemes.