Community leaders have voiced dismay as a high-profile affordable housing development in a village where no homes have been built for more than three decades has stalled amid funding issues.

Almost 15 years after residents of Ingleby Arncliffe, between Northallerton and Stokesley, started work to breathe new life into the community by creating plans for housing, the parish council this week issued a statement saying it was “exploring options” after further delays to an approved scheme for 18 homes for locals.

Parish council chair David Cook said housing association Beyond Housing had stated it had been unable to secure a contractor and had revealed further associated increased costs, meaning “any works will not take place at this point in time”.

Councillor Cook said: “The parish council feels frustrated and disappointed with this latest update and we know many residents will feel the same.”

The parish council’s statement follows villagers voting to adopt a Neighbourhood Plan in 2021 to enshrine the local demand for housing in planning policy and seven years after the village primary school closed.

The school’s closure due to falling pupil numbers sparked a determination among many residents to attract young families to the area and for the former school site to be repurposed for homes for the young and the elderly.

After receiving the parish statement, residents said they were unsure how North Yorkshire Council’s ambitious affordable housing target of building 800 a year was going to be met “if sites with planning permission, where communities want the housing, cannot even get built”.

Beyond Housing said it had received “some positive news” on its brownfield funding bid for the scheme and that it was continuing to work with Homes England over the funding requirements along with North Yorkshire Council and the York and North Yorkshire Combined Authority.

A spokesman added: “Beyond Housing remains committed to delivering these much-needed affordable homes in this rural community.”

Earlier this year it emerged North Yorkshire had become the second most unaffordable county in England for residents to buy or rent property in, leading councillors to call for the county to become “a beacon for social housing”.

Osmotherley and Hutton Rudby division councillor David Hugill said while the development was continuing to face obstacles, particularly over funding, he remained convinced it would eventually go ahead, particularly following recent Government announcements.

He said: “When it’s affordable housing there’s a lot of things to get lined up in the right order to get moving. It’s frustrating because people are almost ready to move into homes at another former school site at nearby Swainby, but at Ingleby Arncliffe it’s still a brownfield site which doesn’t help the mood of the residents.

“People put their names down to live there and time’s moving on. Beyond Housing are doing all the right things to try and raise the finance but it hasn’t happened yet.”

The authority’s executive member for housing, Councillor Simon Myers, said the council was considering how it could best spend funds raised through the second homes council tax premium being launched in April.

He said an idea being examined included focusing money where the social benefits of developing affordable homes had been judged to be high, but the scheme needed a cash injection to make it financially viable.