The 198-home Southside housing project will be nearly a year late with building not due to start until November at the earliest.

And understands that Bermuda Land Development Company is very unlikely to run the project, despite Government announcing in March that the quango would step in when Bermuda Homes for People (BHP) was declared insolvent.

However BHP, the non-profit organisation which masterminded the concept, is confident the project is back on track now that interim financing is set to come on stream.

BHP project director John Gaston said: ?International companies are still on board after this delay.

?There was a delay in interim financing. I think we have got that worked out. In the last two weeks we have made a huge turn in the right direction.

He said the project would now be completed by April 7, 2007.

The original completion date had been June, 2006 but the failure to move business tenants off the site delayed the project while a funding shortfall also stopped work.

Mr. Gaston said: ?We have had two pretty good sized delays but I think finally we are there.?

He said a clean up of petrol spilled by business tenants would start on the site in September with demolition then set to finish in November.

However, Mr. Gaston could not say when building would start. Although BHP has previously boasted that prefab homes could be put up in a day, Mr. Gaston said the components had to be made and shipped before work could begin.

Three Canadian firms have been shortlisted with each lined up to erect a demonstration home to showcase their work.

The winning firm will send managers to train Bermudians to erect the homes which will be supplied with water from two large tanks and a reverse osmosis plant. understands BLDC will not run the project but Mr. Gaston said he was unsure what would happen.

?We have always stated it was an independent project. Government has been an important community member in granting the land. That?s what makes the project work.

?But it is a private sector project ? built privately and not by Government.?

A lottery will be held on Friday deciding who gets the right to buy one of the 98 homes priced at $199,000.

The cut-price homes are being funded by the sale of 98 market-priced homes.

Property Group director Cris Valdes Dapena said 37 deposits have been taken and no-one has pulled out of the project despite the delay in building.