East Lothian Council has agreed to sell on completion a development of 42 new affordable housing units to East Lothian Housing Association. The houses, situated at Baxter's Gate, Windygoul, Tranent, are due to be completed in June 2009.

The decision was taken at a meeting of its Cabinet on 13 January 2009.

Work began on the site in May 2008. The purchase price will include a valuation of the land carried out by the District Valuer, the original £4.3m contract cost and other fees and costs incurred by the Council during the construction process.

Housing Associations receive Housing Association Grant (HAG) from the Scottish Government, to provide new affordable housing.

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This year's budget allocated for Housing Association developments in East Lothian is in danger of being underspent, which would potentially limit access to further funding in years to come.

By selling the properties, the HAG will be fully used and East Lothian Council will raise vital funds to progress its affordable housing programme in future years. The Council will also have 100% nominations for the first let of the 42 new affordable houses. The homes will also not be subject to the 'Right To Buy', meaning they will be retained as housing for rent in perpetuity.

Cabinet member for Housing and Community Services, Councillor Stuart Currie, told the meeting: "Our policy is to work with our housing association partners to make best use of the Government funding that will help us to deliver new affordable housing for rent in East Lothian. Any underspend in the Housing Association Grant would limit our potential to tap into this valuable fund in future years.

"This decision is practical and pragmatic, and recognises the potential long-term consequences of failing to make the most of the grant funds available. The revenue that we raise will allow us to further the Council’s own affordable house building programme in 2009-2010."

(GK/JM)