A SCHEME to build 350 homes has been scrapped due to "market conditions" following a review.

The homes were due to be built on land earmarked for redevelopment at the junction of Blackhorse Road and Forest Road.

The development was one of 16 sites across London being developed by the London-Wide Initiative (LWI), which aimed to build 1,500 homes for keyworkers and 1,000 affordable homes across the city.

But the Homes and Communities Agency, which manages the initiative, has decided to scrap the Blackhorse Road scheme following a review.

The 1.7-hectare site earmarked for redevelopment has been sold to Waltham Forest Council, which plans to build a school there.

The Guardian is awaiting details of the proposed school development.

Proposals for the housing development, which was being developed by Key London Alliance, included a 15-storey building containing 35 per cent affordable housing, 25 per cent homes for key workers - including teachers and nurses - and 40 per cent market value homes.

The news follows recent figures which showed the borough had the sharpest rise in London in the number of people on waiting lists for affordable housing.

Figures published by the National Housing Federation in March showed the number of people in the borough waiting for social housing to become available rose by 4,686 between April 2008 and April 2009.

The increase brought the total number of homes needed to 14,341, equivalent to about 35,852 people in need of council accommodation.

Click here to follow the Waltham Forest Guardian on Twitter