Construction of 45 new council homes in Ladybank has been ditched after Fife Council pulled out of collaboration with a private developer.
The 33 houses and 12 flats were to be built on land south of Commercial Road by a private company.
Planning consent was issued in May last year for the development.
However, Culross-based Ladybank Homes now wants to sell the homes, which are yet to be built, privately.
Only a quarter of them would remain as affordable housing, in accordance with planning policy.
It has requested a condition be dropped on the existing planning consent that the properties remain as affordable housing but has also submitted a fresh planning application proposing a mixture of 34 cottage flats and villas instead.
Reasons for the council’s withdrawal were unclear but Howe of Fife and Tay Coast councillor Donald Lothian said it was disappointing.
He said: “The land in question is formed by a former haulage yard which ceased trading well over 10 years ago and also a former curling pond which previously was out with the settlement boundary.
“A private developer previously looked at the site but nothing happened and then two to three years ago the council consulted locally about the provision of council housing on the site.
“This proposal appeared to me to be met reasonably positively by the local community.
“I am therefore disappointed that the council has withdrawn its interest in the site for council housing and intend to find out the reasons behind this.
“This new application will now need to be determined on its own merits.”
The applicant was unavailable for comment yesterday but in a document submitted to council planners said that the council had entered into an agreement to take over all of the properties for affordable council housing but “now no longer wishes to take up this option”.
The council’s affordable housing programme manager David Weir said the local authority had “been in discussions with Ladybank Homes about potentially acquiring this development but that an agreement was not reached for the council to purchase the properties”.
