A REGENERATION scheme in Wirral is under threat as the falling price of houses across the region hits developers.

Cosmopolitan Housing planned to develop a site off Rice Lane in Egremont to provide a mix of starter homes for first-time buyers and homes to rent.

The development, which had been welcomed by councillors and residents in the area, is now in jeopardy as Cosmopolitan warns that the starter homes may no longer be viable.

The scheme is for 36 new homes – 18 of which will be shared ownership and the rest rented.

But a report to the council suggests that a lack of mortgage credit together with a downturn in the housing market is to blame.

A Council spokesperson said: “In light of the current economic climate, Cosmopolitan Housing Group have informed us that they are reviewing the viability of such an extensive shared ownership element of the project at this time.

“However, the financial commitment from the Housing Association to develop this site is still there and we remain committed to working with Cosmopolitan and with local councillors to progress this development and are currently discussing a number of potential alternative options.”

Local councillor James Keeley said: “This is yet another blow to Egremont. The area has been promised so much by way of regeneration and housing development but so little has been delivered.

“Understandably, people are very angry that they will have to wait even longer for this promised development to come to fruition.

“Shared ownership schemes have long been heralded by the Government as an integral part of their plan to get more young people on the housing ladder. However it seems in the current economic circumstances, they are the first schemes to be sacrificed.

“Egremont has always been bottom of the list when it comes to receiving public money for housing development. We were desperately relying on private developments such as this to deliver for the people of Egremont where public bodies have consistently failed.”

Geoff Redhead, Cosmopolitan Housing Association’s chief executive, admitted “the effects of the credit crunch are far- reaching”.

But he said: “We have a responsibility to neighbourhoods to develop homes for which there is a demand and we are therefore working with our partners at Wirral council to explore an appropriate mix of properties for rent or sale to ensure that we are able to deliver on our commitments to the Egremont community and provide housing that meets the long term needs of the area.”