A DELAYED scheme to deliver much-needed affordable housing in West Somerset could finally be given the green light - providing the district council shoulders a £140,000 loss on the sale of the land.

Thirty new homes could be built at Townsend Farm in Carhampton, with ten homes to rent, ten to buy with shared ownership and ten for sale on the open market.

But although the deal with Hastoe Housing Association could secure a £350,000 windfall for the hard-up authority, the council will still effectively make a loss after buying the land for £490,000 in 2007.

The scheme has hit a number of stumbling blocks in the last few years and the hold ups have coincided with a slump in both property and land prices.

Although work could start on the development in just over 12 months' time, it is now unlikely to be the flagship eco-friendly development the council had hoped it would be.

Initially, the homes were due to be built to almost the top level of the scale used to rate sustainable buildings by developer ECOS and managed and maintained by the Carhampton and Withycombe Community Land Trust.

However, the trust pulled out in May 2009 and the council was at one stage considering reducing the number of affordable homes in favour of open market dwellings to try and make the figures stack up.

Since then, further meetings have been held between the council and a number of housing associations, while ECOS subsequently partnered with Hastoe.

At next Wednesday's meeting of the full district council, members will be told that both ECOS and Hastoe had been asked to provide up-to-date financial appraisals for the scheme last year but, to date, while Hastoe has provided details, nothing has been forthcoming from ECOS.

Councillors will be asked to ditch ECOS from the project and to give approval for the council to go it alone with Hastoe.

They will discuss two options, one of which would see prospective tenants having to pay more in rent and also land the council with more than double what it could sell the land for if rents were pegged at social housing levels.

The preferred option put before councillors would see the council sell the land to Hastoe for £350,000 on condition 80 per cent of the rented homes use the authority's affordable rent model and the shared-ownership homes are offered with a minimum 40 per cent sale share.

The second, and not recommended option, would see the council selling the land to the association for £150,000, with Hastoe then charging lower rents and the authority having to subsidise the entire development to the tune of £10,000 per plot.

Graham Carne, the council's finance chief, will tell councillors the preferred option has been chosen as it is the only one which would attract funding from the Homes and Communities Agency.

The council also has a duty to maximise its assets and do all it can to secure affordable housing for local people.

Hastoe has until May to apply for grant funding from the agency and is more likely to be successful if it can show it has the council's full support.

If everything goes smoothly, a planning application for the development could be submitted before the end of the summer and work could start between April 2012 and March 2013.

Ian Timms, the council's housing and community group manager, will tell next Wednesday's meeting: "Residents of Carhampton have been consulted over a number of years on a range of schemes.

"Prior to submission of the planning application, Hastoe Housing Association plans to carry out further consultation with the parish council and residents, working closely with them to create the finalised application.

"This will replicate the work already done and attempt to ensure that all of those previously involved are able to have an input in the proposal."

All 30 of the proposed houses would still rate fairly highly on the sustainable homes scale, while Hastoe would use the money from the sale of the open market properties to subsidise the affordable element of the scheme.