PLANS have been unveiled for a £60m housing development on a former factory site.

Dunelm Homes are planning to build up to 300 homes on the former Cape asbestos factory plot, on Bowburn North Industrial Estate, Bowburn.

They will have between two and five bedrooms and be priced at between £135,000 and £300,000.

The firm will begin marketing 121 of the homes, to be built in the first stage of the project, on Saturday.

Colin Willetts, from Dunelm Homes, said despite the recession, there had already been a lot of interest in the houses.

"The first part of the site will be starter homes and research over the last month has told us there is demand for starter homes.

"We’re seeing confidence returning to the market. There have been more reservations than we would have anticipated since January."

A planning application has been submitted to Durham County Council and if councillors back the scheme building work on the first stage could begin in August, with people moving in from March.

It is hoped all the houses would be built within five years.

The 30-acre site has been unused since 1990, when the Cape factory closed with the loss of 170 jobs.

In 2007, Hallam Land Management and Commercial Estates Group successfully fought a public inquiry to be allowed to build 250 homes, offices and light industrial units on the site, but the project never went ahead.

The plot was sold to Esh Group, who spent £1.8m on decontamination before the National House Builders Council declared it clean and prepared for future development.

David Halfacre, from Esh, said: "This is right outside our office door. It’s been sitting there in our view ever since we moved here in 2003.

"We always had a desire that we should get involved with it. We’re committed to it despite the credit crunch and we’re committed to it all the way through.

"We have put our money where our mouth is."

The houses will cover 20 acres of the site, with the rest potentially used for business.

Dunelm Homes staff will be at the site to answer questions about the first stage housing project between 10am and 5pm on Saturday and Sunday, and then between 10am and 5pm Thursday to Monday.