The scheme will be delivered by developer Banks Group and will also comprise office space, shops, community facilities and a designated 'university quarter' which will provide accommodation for 1,000 Durham University students.
Banks Group said in a statement it expects the scheme to deliver around 220 local jobs.
The Council's planning officers said in their report (44-page / 868KB PDF) to the committee that the scheme would bring "considerable" benefits. "Durham University would be supported in its objective of remaining one of the country’s leading seats of learning, while pressure on the City’s housing stock from student lets would be significantly reduced," they said.
"Truly aspirational executive housing would be provided in a prestigious location, and a mix of market housing, including that for the elderly, would be developed within interconnected neighbourhoods of distinctive and individual identities with associated community and retail facilities," the officers said.
Banks Group and the Council will enter into a section 106 agreement under which Banks Group will provide a financial contribution of over £4.2 million towards highway improvements, improved public transport as well as 58 off-site affordable homes.
“Our vision for Mount Oswald is to create an outstanding, high quality, low density, sustainable new neighbourhood of families and students with a green infrastructure that provides new green links and wildlife habitats and is well connected to public transport," said Banks Group environment and community director Mark Dowdall.
“It has been designed to contribute to the realisation of Durham County Council’s vision of Durham City acting as a driver of economic growth in the county, and would directly and indirectly support hundreds of local jobs at a time when such employment opportunities are very badly needed," he said.
“It would also have an enduring positive impact on the city’s retail and housing sectors, and on Durham University’s drive towards maintaining its position as one of the world’s pre-eminent educational institutions," Dowdall said.
