The prime minister's pledge to create 200,000 cut-price starter homes for first-time buyers has prompted concerns from the Chartered Institute of Housing (CIH).

David Cameron said this week that up to 20 per cent could be knocked off the prices of these homes, should the Conservative Party win the next general election.

The CIH said it welcomes the fact that the government is focusing on the supply and affordability of homes, as less than half the number of new properties that are needed are currently being built.

However, the organisation said it has concerns about the fact the sites for these starter homes will be exempt from section 106 agreements, as these "usually require social or affordable homes to be built as part of a development for people on lower incomes".

Gavin Smart, interim chief executive of the CIH, said the promise therefore "smacks of building for one group of people at the expense of another".

He insisted that social housing is "critical" if the UK's ongoing housing crisis is to be solved, as there will always be some people who cannot afford to purchase a home.

Mr Smart insisted that decent and affordable homes must be provided for these individuals too, as placing all the focus on home ownership means "we are never going to build mixed communities".

He added that while the housing crisis can be solved in a generation, this will only be possible with a "long-term commitment from all our political parties".

The prime minister believes offering a 20 per cent discount on starter homes represents a "real game-changer" for lots of aspiring homeowners.

Mr Cameron went on to stress that the Conservatives want to help "people who work hard and want to get on in life but have been priced out of the housing market".