The government is encouraging some of the most desirable county towns in the Midlands to become mini-growth areas.
The government office for the West Midlands has written to councils in Burton-on-Trent, Hereford, Rugby, Shrewsbury and Worcester, inviting them to apply for cash from its £40m fund to unlock housing development sites.
The deadline for submissions of interest in the growth point fund, announced by chancellor Gordon Brown in last November's pre-budget statement, was the end of last month.
All of the towns, with the exception of Burton, have been identified for taking extra housing in the West Midlands regional spatial strategy (RSS), but only if the Birmingham-Black Country conurbation is unable to provide enough sites.
Encouraging extra housing outside the main conurbation would mark a break from the existing RSS, which aims to channel housing growth into the conurbation.
Rose Poulter, West Midlands regional assembly planning policy manager, said: "Sub-regional centres will be called to accept if the major urban areas can't accommodate it."
The assembly is backing a joint bid by the conurbation's councils and Telford.
Poole council has submitted a bid to fund a bridge linking the town with an island in its harbour, where JJ Gallagher is planning 2000 homes. Derby, Leicester and Nottingham have submitted a joint bid to kickstart city centre regeneration projects.
Portsmouth and Southampton and Colchester and Ipswich have both submitted joint bids from the fund. Bristol, Exeter, Norwich, Plymouth, Torbay and Swindon have also submitted bids.
