A private developers' plan to build a new border village near Derry has sparked controversy.

Residents of Kilrea, three miles from Derry, have said they will oppose proposals to build 500 new properties, on a 47-acre former factory site, next to their homes.

The border area has seen a huge growth in population in recent years - and many people from Derry are crossing the border to new housing developments in the likes of Kilrea and Newtowncunningham, in order to take advantage of the widening currency gap.

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Local residents however, are calling for a halt to the development and intend to oppose the planning applications for the new village - claiming the development will contravene an area plan, which was adopted in 2004.

As well as 500 new homes the McAllister Holdings plans include a health centre, a village green, a hotel, a bar and restaurant, retail outlets and offices.

If the development gets the green light it will mirror the massive development plans on the western side of Derry.

Donegal County Council is expected to receive plans shortly.

(VB)