MONTHS of worry could be over for homeowners due to be given new houses under a land deal between a council and developers.

Wear Valley District Council was due to give the go-ahead yesterday for Persimmon Homes to rebuild two streets on the St Andrew's Estate in Bishop Auckland, that were condemned as 'unsafe' in October 2001.

Homeowners, who feared they could lose tens of thousands of pounds, are being offered either a new three-bedroomed house on the development or £50,000 compensation.

All but two have agreed terms and most people, it is understood, have opted for a new home.

People who bought their homes from the council under the right-to-buy scheme originally feared that they were only going to get the site value as compensation. The council has already moved 73 tenants from St Cuthbert's Walk and St Aidan's Walk, where asbestos was found in walls and corrosive salts in the concrete foundations.

The remaining tenants are asking for homes on estates in Henknowle and Bishop Auckland.

But they could be forced to move to their second choice areas or given temporary homes in bungalows elsewhere on St Andrew's because the council's housing committee has already given officers statutory powers to move people out.

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

Yesterday's special meeting of the committee was asked to rubber stamp the agreement with Persimmon as the redevelopment partner. The council also needs Government permission to sell off its holdings on the estate and submit planning permission for the scheme.

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's housing director Michael Laing said: "It is encouraging that agreement has been reached with 27 out of the 29 owners and that 73 tenants have been re-housed.

"The redevelopment of the estate is now every likely to take place to the satisfaction of all."