Property: Brown fields, green housing

Much-needed homes are increasingly being built on derelict land rather than on green-field sites.

It takes a courageous house-builder to turn an ugly duckling of a site into a beautiful development of new homes. With contamination problems to contend with, plus demolition and clearing, it takes several months before they can start building. And that takes no account of the extra expenses involved, including the landfill taxes that have to be paid.

Morris Homes, which builds in the north west of England, has been taking on difficult sites for 30 years. "We have done loads of unattractive sites - former collieries, derelict hospitals, railway sidings. We did one of those next door to Aintree racecourse," says Martin Edmunds, the land director.

"This sort of development accounts for around 60 per cent of what we do. It is all very well for the Government to be pressing the issue of building on brown-field sites, but it depends where you are. Up here around Blackburn, Bury and Manchester, an area that has a history of industrial dereliction, there are plenty of sites, although not everyone wants to tackle them. In more rural counties, the situation is more difficult."

The company is currently working on a seven-acre site in Bury. This was a former cotton mill, which was more recently used by a plastics company. It was pretty dilapidated, although still in use, and stood in the middle of a residential area.

When Morris Homes put in its application, the planners threw their hands up in horror.

"It is a valuable employment site," they said, "and not allocated for housing." But since the plastics company was relocating, Morris Homes managed to persuade the planners that redevelopment would be a good idea.

"Our application got through straight away. The politicians and locals were delighted. The factory had been pumping out horrible fumes and everyone wanted to get rid of it," says Mr Edmunds. The three- and four-bedroom houses at Millbrook, to be built behind the old mill pond, are on the market at between pounds 55,000 and pounds 195,000.

Earlier this year Leach Homes acquired part of an old farmyard, which was being used as a haulage depot, at Aspenden, north of Hertford.

"This was quite gruesome," says John James, the managing director. "There were old axle stands, an oil pit and old buildings with corrugated iron roofs. There was quite a lot of demolition, and some of the buildings were infested with rats."

It took three months for the company to clear the site, going full pelt. They had to use massive cranes and huge containers to carry all the rubbish away, including the timbers, which are not allowed to be burnt. "The site backs on to farmland and sits right opposite the village green, where cricket is played and fetes are held, so the village was delighted that it was being brought into proper use," says James.

Five four-bedroom detached houses are being built, clustered around a duck pond, which the company is creating and into which the rain water will drain. The houses will be priced at pounds 325,000 each.

Another classic ugly duckling site is Sovereign Farm, on the edge of Burwash Common, East Sussex. This was previously a chicken processing plant, and had stood derelict since 1990. The concrete-slabbed site consisted of a number of unsightly pre-fab buildings and outhouses. It is now being transformed by Millwood Designer Homes into a small development of five timber-framed homes.

The company has installed a bio-friendly sewage system and has planted 1,400 trees and shrubs to enhance the site further. The five-bedroom houses are priced at between pounds 500,000 and pounds 565,000.

Berkeley Homes, in Kent, has recently undertaken to redevelop two derelict sites. Hildenbrook Farm used to be a run-down hospital within a residential area surrounded by green belt. "It was quite out of character, an eyesore for the area," says David Rick, the sales director.

The local authority had quite a lot of input into the styling of the new development, which will have a farm feel about it, and the 31 homes - a combination of large apartments, cottages and detached properties - are priced at from pounds 179,000 to pounds 1.2m.

The second site is opposite Canterbury West station, a large area of derelict buildings and wasteland. "It was an old goods yard, full of rubble and overgrown vegetation, and the whole desolate area is being rejuvenated," says Rick. Berkeley is building 250 homes at St Dunstan's Gate, ranging from apartments to four-bedroom houses. Prices will range from pounds 65,000 to pounds 120,000.

In Yeading, Middlesex, Barratt Homes has just bought a piece of industrial land that was once owned by British Telecom. On the six-acre site are large, unattractive warehouses beside a large expanse of concrete, through which weeds are growing prolifically.

The site overlooks a Thames Water reservoir on one side and protected scrub land on the other and is close to a marina on the Grand Union canal. Arundel Fields will consist of 104 two- and three-bedroom houses for open market sale, plus 36 more for rent through a local housing association. Prices are expected to start at pounds 120,000.

The vast majority of Barratt's building work in London and the South- east now takes place on recycled land, with former uses ranging from factories to industrial yards.

"We aim to provide high-quality, value-for-money homes, where we can recycle redundant and none-too-attractive industrial land and have a positive effect on the local environment and property values," says David Pretty, chairman of Barratt Southern.

Morris Homes, 01942 272020; Leach Homes, 01920 822200; Millwood Homes, 01732 770991; Berkeley Homes (Kent), 01959 561499; Barratt Homes, 0181 607 1919.