Birmingham City Council has announced plans to build over 131 homes within the next twelve months; a scale of council house building not seen in Birmingham for the last 30 years.

The plans will eventually deliver 500 new council homes a year. Across the country, just 375 council houses were built last year.

To support this programme the Council's Cabinet will be asked to give the go-ahead for a bid to the Homes and Communities Agency (HCA) for £7.2million in funding towards the project, from the £100million allocation announced in this year's Budget.

If the bid to the HCA proves successful, this money will then be supplemented with £8 million from the council itself, to enable the building of the new two, three and four bed homes.

The homes in the first phase are planned in four key areas of Birmingham where the demand for affordable housing is at its highest. The new homes will be built on land which is already owned by the council. The first phase of homes will be available on a social rent basis while the Council's longer term plan is to create multi-tenure housing opportunities city wide.

Councillor John Lines, cabinet member for Housing, said: "I am delighted that Birmingham and other councils are now in a position to intervene in the housing market directly and take our first steps to build much needed affordable homes for our people.

"Given the economic climate, the housing market has weakened and financing for RSL development has become harder, which is why we've decided to step in and take a lead. These 131 homes will be the first phase of hundreds of homes we will deliver to ensure that Birmingham residents can live in a range of sustainable, affordable homes of all sizes and tenures, across the city."

Bids to the HCA for funding take place in two rounds, with submissions due in July and October 2009 respectively. Decisions on each round of bidding are expected by the end of the year, allowing building of new homes to begin in March 2010 and be completed by Easter 2011.