COLCHESTER Council bosses are set to approve a £1.26 million grant to go towards building 19 new homes for families in need.

Colchester Council is set to hand the cash over to Family Mosaic Housing Association and work on the scheme, off Butt Road, Colchester, could begin before the end of the year.

The 19 two and three-bed homes, which will include three wheelchair-adapted houses, will be part of a development which is already being funded by the housing association.

As a result of the grant, Colchester Council would be given nomination rights, which means the homes can only be let through the Gateway to Homechoice - the method used to allocate homes by the authority as well as Braintree, Maldon and Ipswich councils.

But only households with a connection to Colchester will be allocated the homes when they are first let.

The money is from the sale of former homes through the Right to Buy scheme, which must be spent within three years.

The move comes as official council figures show a £403,000 overspend on providing emergency bed and breakfast accommodation for 204 homeless households in 2016/17 and on tackling homelessness in general.

At the moment, 4,941 households are on the housing waiting list.

Paul Smith, leader of Colchester Council, said: “We had planned on using it to build our own homes until the restrictions on local authorities’ borrowing were placed upon us.

“It is now getting close to three years and we did not want to have to hand £1.2 million back to the Treasury.”

Family Mosaic is already paying for 17 units on the site, which is the only remaining plot of the old Garrison site yet to be developed.

Mr Smith added: “We had a choice between 19 extra homes or handing that money back the treasury and that is a no-brainer.” A planning application is expected to be submitted later this month.

Mr Smith said: “We are realistic, 19 new homes is not going to solve the problem.

“But it could be that by building one home, we can potentially properly house three families, with one family moving from a two-bed to a three-bed, one moving from a one-bed to a two-bed and one family moving from temporary accommodation.

“To put this into context, last year we built about 100 social units in Colchester. Setting that against 4,000 households on the list, it isn’t much and we know that.”

A housing association spokesman said: “Family Mosaic is excited to be working alongside Colchester Council to add to the affordable housing stock we already provide across the borough.

“We are looking forward to submitting a planning application that will rejuvenate and bring back to the life a derelict and overgrown site.”