TWO and half years of uncertainty should soon be over for 27 homeowners due to be given new houses under a land deal struck between a council and developer.

Wear Valley District Council gave approval for Persimmon Homes to rebuild two streets on the St Andrew's Estate, in Bishop Auckland. The 120 homes in the area were condemned as unsafe in October 2001.

Owners, who feared they could lose tens of thousands of pounds, are now being offered either a new three-bedroomed house on the development or £50,000 in compensation. All but one, a private landlord, have agreed terms and most people, it is understood, have opted for a new property.

People bought their homes from the council under the right-to-buy scheme and originally feared that they were only going to get the site value as compensation, dropping from about £40,000 to just £2,500.

The council has already moved 73 tenants from St Cuthbert's Walk and St Aidan's Walk, where asbestos was discovered in some walls. Corrosive salts had also made the concrete foundations unstable.

The remaining 18 tenants are asking for homes on estates in Henknowle and elsewhere in Bishop Auckland. They may have to move to second choice areas or be given temporary homes elsewhere on St Andrew's while the work is under way.

Bulldozers are due to move on to the site early next year and the new homes will be built as demolition progresses.

Last week's special meeting of the housing committee rubber-stamped the agreement with Persimmon as the redevelopment partner.

Most of the new homes will be for sale. Some will be two-bedroomed bungalows provided by Durham Aged Mineworkers Homes Association and houses provided by Endeavour Housing Association.

Both organisations have applied to the Housing Corporation for funding.

The council now needs to seek Government permission to sell off its holdings on the estate and submit a planning application for the proposed scheme.

The authority's housing director, Michael Laing, told councillors: "We said we would do all we could to reach a solution with owners, rehouse tenants in suitable accommodation and see the site redeveloped. I am very pleased that this arrangement will do exactly that."

Ward councillor Betty Todd said: "It has been a difficult time but everyone concerned has worked very hard to find a positive solution."