The land – which was bought from Somerston Capital – is located within the plans for Otterpool Park which lies between Lympne and the Lympne Industrial Estate and is near junction 11 of the M20.
The proposed garden town of Otterpool Park will provide up to 12,000 homes near Folkestone and has been put forward by Shepway District Council and Cozumel Estates Ltd.
Paul Kitson, general manager for the South East for Homes England, said: “Buying this land shows how Homes England is determined to use our finance and expertise to expand the delivery of affordable new homes and connect ambitious partners.
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“We have been very impressed by the ambition shown by the council and landowners to deliver Otterpool Park – a garden town for the 21st century.
“Owning this land will give us a voice in delivering a community that will meet the local need for homes in a place that is truly environmentally, socially and economically sustainable.”
David Monk, leader of Shepway District Council, added: “I am delighted that Homes England has co-invested with the council to deliver Otterpool Park.
“It shows the government has faith in our plans for this garden town.
“This investment will help us deliver an even better place so that our children and grandchildren can have the homes they need in a community that will also meet their needs for jobs, access to the countryside, transport links, schools, health centres and a great quality of life.”