A GOVERNMENT u-turn could see Reading Prison sold off as part of plans to dispose of Victorian-era properties in favour of housing.
Last month Reading Borough Council vowed to lobby the Ministry of Justice after it said the site would remain empty as a "contingency measure".
However this morning the Treasury has announced Reading could be the first of a series of prisons to be sold before 2020.
Councillor Tony Page, deputy leader of Reading Borough Council, said: "This is welcome in principle providing it is followed by a time table.
"Like all public organisations - the council included - the government has to go through certain processes and the private sector will not take it seriously until there is a timetable.
"Once we get a timetable we are all working to and there is clarity I am sure there will be a lot of potential investors."
The news came as part of Chancellor George Osborne's statement on bringing government spending down.
He said: "This spending review is about reform as much as it is about making savings.
"One important step will be to modernise the prison estate. So many of our jails are relics from Victorian times on prime real estate in our inner cities.
"So we are going to reform the infrastructure of our prison system, building new institutions which are modern, suitable and rehabilitative.
"And we will close old, outdated prisons in city centres, and sell the sites to build thousands of much-needed new homes."
Although Cllr Page approved of getting the ball rolling he was sceptical as to whether housing would be the only solution.
Cllr Page said: "It is a Grade II listed building it is inconceivable there would ever be permission to bulldoze it so the alternatives are fairly limited."
Council leaders and Reading UK CIC have both previously stated that a mixed use of the site - including retail, housing, museum and possibly hotel aspects - would be the most likely to succeed.