Westminster to build 500 affordable homes

Westminster has received a grant of £36million from the Housing Corporation, the Government agency that funds new affordable homes, to build 526 properties on brownfield and underused sites on existing council estates.

The sites, which are in areas such as Little Venice, Hyde Park, Bayswater, Edgware Road and Queen's Park, include run-down garages and a redundant boiler house.

Some 246 will be rented homes, of which more than half will have at least three bedrooms, helping overcrowded households in the city.

There will be 104 shared-ownership flats and 69 one-bedroom starter homes with a discounted price of around £150,000, aimed at first-time buyers.

The starter homes will remain affordable through a clause in the lease that means the discount on the market price has to be passed on to future purchasers.

To help finance the scheme, Citywest Homes will build 107 homes, which will be sold at market price.

Consultation with residents will begin in the coming weeks.

Phillipa Roe, Westminster's cabinet member for housing, said: "This grant is a major boost to many residents looking to get a foot on the housing ladder and those living in overcrowded conditions. It is one of our top priorities to provide more affordable housingin the heart of the capital and we are delighted to have secured the support of the Housing Corporation."

Brian Johnson, chief executive of Citywest Homes, said: "This is tremendous news for us but, more importantly, it's even better news for the people of Westminster.

"It means we can now press ahead with our programme to build new homes for local people who need them.

"We will now begin working closely with a number of communities where we can develop new homes and start bringing forward schemes in the next 12 months or so."

Westminster, which has not built council homes for 30 years, has a longstanding problem with overcrowding and has previously offered up to £100,000 for people to leave their council homes.

Last year, the council announced it was spending £49million on buying back council houses, and told thousands of homeowners it would pay up to 20 times the amount they had paid for the properties under "right-tobuy" laws. Some of the flats were sold at huge discounts in the Eighties when the council was caught up in the "homes-for-votes" scandal under its disgraced former Conservative leader, Dame Shirley Porter.

Homes in eight marginal wards were sold to private buyers in the hope the new owners would be more likely to vote for the Tories.

At the same time, poor families thought less likely to back the party were housed in blocks riddled with asbestos in Labour wards.

After an inquiry, Tesco heiress Dame Shirley and five former council colleagues were found guilty of "wilful misconduct" and "disgraceful and improper gerrymandering" and had a £31.6 million surcharge imposed on them.

After a number of court cases, in 2004 Dame Shirley agreed to pay Westminster £12.3 million.