The development will provide newly built homes for secure council tenants and owner-occupiers on their estates, as well as homes for low-cost rent, shared ownership, market rent and for sale.

Also included in the development is a new leisure centre and redesigned park, a new library, shops and business space.

The funding from City Hall is part of the £3.5bn fund given to the mayor by the government last year to build new homes for low-cost rent and shared ownership in London.

The new homes are prioritised for the residents of the Winstanley and York Road estates, which are being regenerated over the next 10 years by the council in partnership with Taylor Wimpey.

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Cllr Clare Salier, cabinet member for housing, said: “It is excellent news that the mayor of London is providing clear support for our housebuilding programme, which shows that building new homes in the capital is a cross-party, non-partisan matter of priority.

"These new homes will enable the regeneration of the Winstanley and York Road estates, which will not only provide an increase in council housing, and new community facilities, but also on-site employment and training opportunities for local residents.”

Planning permission for the scheme was granted last month and the council is expected to appoint a contractor in the coming weeks.

It is claimed that the scheme will be the largest single development so far of the town hall’s housebuilding programme.