DOZENS more affordable homes are on the way across South Lakeland thanks to a £6 million loan fund approved by councillors.

The pot of money will enable housing associations to access low-rate finance from South Lakeland District Council and remove an obstacle which may be preventing them from building more houses.

In exchange the council will receive a financial return from repayment of the loans and fulfil its pledge to work with partners to deliver the affordable homes needed in towns and villages across South Lakeland.

A council spokesman said: "This is a win for residents who need homes they can afford, a win for housing associations, a win for council tax payers because this is efficient use of money the council already has and it’s a win for the local economy because house building stimulates economic growth.”

A meeting of SLDC's Cabinet heard the innovative loan facility highlights the council’s ambitions to deliver homes to meet local need.

The council will initially allocate a maximum of £6 million to the loan fund from existing and projected housing resources. It is estimated the funding will support the delivery of 48 new affordable homes.

If the first funding projects are successful the council may consider increasing the loan fund to £15 million.

South Lakes Housing, the council's main partner, said the loan fund will have a positive impact.

"Increasing the number of new affordable homes in the area is a key priority for South Lakes Housing," said its chief executive, Cath Purdy.

"By working in partnership with SLDC, this funding will unlock schemes which may otherwise not have been possible and provide much-needed homes for local people.”

The creation of the new loan fund followed a council-commissioned study which identified the need for more creative approaches to delivering affordable housing.

SLDC says it is on target to help create 1,000 new affordable homes for rent by 2025.

A study concluded that up to 320 new homes need to be built every year across South Lakeland, of which up to 290 are needed per year in SLDC’s planning area outside the Lake District National Park.