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The government is to lend a developer £53.8 million to kick start the construction of 5,750 new homes in the county.
The cash from the Homes and Communities Agency will be used for “essential services” to build the first phase of Chilmington Green, near Ashford.
That will see the development of 1,500 new homes, new schools, a district centre and a community hub, expected to be completed in 2022.
The village will be built by a consortium of five companies, known as Hodson Developments, and will be the largest housing estate in the town, with 300 homes built every year.
The developer has pledged to put in £125 million overall to pay for new schools, infrastructure and amenities.
The housing scheme was granted outline planning permission on October 2014, despite fierce objections from nearby residents.
The £53.8 million loan comes from the government’s £3 billion home building fund and is aimed at speeding up the construction of homes by providing infrastructure. This will include widening the A28.
Housing and Planning Minister Gavin Barwell said: “We want to fix the broken market by building more homes so that housing becomes more affordable.
“Our aim is to help those who are locked out of the housing market.
“As one of the largest developments in Kent, Chilmington Green will not only create thousands of homes, but will also create jobs and opportunities for hundreds of people.”
Alan Hodson, managing director of Hodson Developments, said: “The support from the government’s home building fund is very welcome.
“It means that we can focus on delivering the new homes that are so desperately needed and we are looking forward to getting started.”
Preparation work at the site has now started, and building work is expected to start this spring.
The second phase will deliver 1,124 new homes, as well as a primary school and new community amenities.
Phase three will create the Orchard Village with another primary school and 1,559 new homes.
The fourth phase will create 1,567 new homes, Chilmington Brook centre with a primary school and a discovery park containing sports facilities.
Ashford Borough Council leader Cllr Gerry Clarkson said: “This is just one of a number of exciting developments coming forward which are changing the face and fortunes of this wonderful borough.
“From the outset of the project the ambition has been to create a place of special character with a strong community feel.”