TENANTS and landlords can't afford to move to new homes in parts of Blackburn, because a government grant has been withdrawn, a report has revealed.

An Urban Task Force, set up by the Government to provide a progress report on the rebuilding of run-down areas with old terrace homes today highlighted the Brookhouse and Bastwell areas and recommended that tax incentives be introduced to remedy the problem.

A study describes how Blackburn with Darwen Council worked with Gleeson City Living to revive the area under the Government's City Challenge programme, which helped provide incentives for people to move in.

But despite specially tailoring more than 100 new homes to the needs of the local Asian community, sales have remained slow.

The report says: "While City Challenge has had a significant impact on Brookhouse/Bastwell, there remains a significant problem of poor maintenance and vacant stock.

"While evidence is limited, it would appear that the private rented sector is growing in the area and this is continuing to assist, to a limited degree, in stock improvements.

"However, ongoing maintenance is a significant problem and the council is concerned that vacancy levels could rise further. "A core market problem is that the supply of terrace property exceeds demand and, consequently, capital values are very low, averaging about £15,000 to £25,000."

The report says the problems are typical of inner urban areas. And it suggests reductions in personal tax, insurance premiums and rental costs.

There should also be action to reduce tax levels to encourage owner-occupiers and landlords to refurbish run-down terrace houses and greater activity to encourage housing associations to build and buy properties in such areas.

The Brookhouse and Bastwell development is praised for designing special features to meet the needs of the Asian community, where some extended families have bought two or three neighbouring properties.

However, the final phase of 68 homes has been delayed while the empty houses from the first two phases are sold.

Blackburn with Darwen Council regeneration director Tom Flanagan, said: "Clearly there are problems of poor maintenance and over-capacity in terraced homes all over East Lancashire.

"We would welcome a reduction in VAT to encourage maintenance and improvement in the private sector.

"Any personal tax incentive to those responsible for house maintenance, such as landlords and other owners, would also be welcomed.

"Any measures that will encourage the refurbishment and re-occupation of vacant properties will benefit the private sector housing market."

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