Bicester in Oxfordshire has been chosen as the site for the coalition's second new garden city, the government has confirmed.

Up to 13,000 new homes are due to be built on the edge of the town, as part of the coalition's plans to help deal with the UK's housing shortage.

"I can confirm the government is putting its support behind Bicester," a Treasury spokesperson told the BBC.

The measure was announced as part of a National Infrastructure Plan.

"New houses support economic growth and are a crucial element of a fair society, so I've prioritised the investment of almost £2bn to ensure we can build on average 55,000 new homes a year until 2020," the chief secretary to the Treasury, Danny Alexander, said on Tuesday.

"Combined with the other measures we are announcing today, we will vastly increase supply by providing funding certainty, unlocking capacity in housing associations and kick starting stalled regeneration projects."

Mr Alexander added a government agency could plan, build and sell tens of thousands of homes on public sector land.

He suggested that building projects of this nature could go some way to supplying the 250,000 houses that need to be built every year to meet the current housing shortfall, rather than selling land to private sector house builders who did nothing with the land.

He added: "The message to the house building sector would be simple: if you don't build them, we will."

A pilot project is already under way at Northstowe, a former RAF base in Cambridgeshire, with the capacity for 10,000 houses, That would make it the largest planned town since Milton Keynes.

Garden cities are large-scale developments in which, according to the government, certain features can be "hardwired into designs from the beginning".

The government has said it does not want to "impose any definition of what garden cities are", but features can include "quality design, gardens, accessible green space near homes, access to employment, and local amenities".

Bicester is expected to get a new railway station to serve the expanded population as part of rail plans previously detailed by Deputy Prime Minister Nick Clegg.