PLANS to redevelop part of east Oxford have been shelved due to rising costs and a lack of funding.

Oxford City Council announced proposals to build 42 new homes at Underhill Circus in Barton have been dropped.

A review of the plans estimates a ‘£4.7 million funding gap that is not viable in the current climate’.

Read again: Final chance to have say on plans for 42 new homes

A council statement read: “Supply chain issues and a shortage of materials and labour has meant a sharp rise in building costs across the UK – for example, the cost of materials alone for new housing increased by 19.7 per cent in 2021.

“In an already challenging financial climate, existing commitments on the council’s housing revenue account and general fund mean that such costs could only be met with external funding in the next four years.

“Underhill Circus would not be a priority for Homes England under the Affordable Homes Programme, and the Department for Levelling Up, Housing and Communities has refused a £2.8 million bid to the Levelling Up Fund for infrastructure investment.

“The council believes that stopping work on the scheme now will provide certainty to local residents and businesses that would have been affected by redevelopment.”

Diko Walcott, the city council’s cabinet member for affordable housing, housing security and housing the homeless, said: “A rapid rise in building costs in the last 12 months and a lack of external funding opportunities mean we now face an estimated £4.7 million funding gap which the council cannot afford to plug given the challenging financial pressures we are facing.”

Follow us on Facebook, Twitter, Instagram and Tik Tok

Got a story for us? Send us your news and pictures here

List an event for free on our website here