ZHOUQU, Gansu - The 2,700 families who lost their homes in a devastating mudslide that claimed more than 1,500 lives two years ago in Northwest China's Gansu province will move into new apartments by the end of the year, local authorities said.

A total of 3,580 apartments have been distributed to the families, said Yi Jianglin, deputy director of the Zhouqu county reconstruction management office.

Affordable homes that were under construction at the time of the disaster were also destroyed, Yi said, adding that those who were supposed to move into those houses will also be entitled to the new apartments.

The affected families have been relocated to three areas in order to reduce pressure on the local environment. Two of the areas are in Zhouqu, while the third is in the provincial capital of Lanzhou.

Residential buildings, boarding schools and hospitals were built at a cost of 601.85 million yuan ($95 million) for 8,000 people relocated to a new district in the provincial capital of Lanzhou.

"Moving here has really improved our lives, as the new district is like a special development zone for us and our children can get a quality education," said Bao Li, a local resident who moved into a new apartment in Lanzhou in July.

Zhouqu county was devastated when a mudslide roared down the slopes of a nearby mountain on August 8, 2010 following days of heavy rain. The disaster left 1,765 people dead or missing, in addition to destroying buildings and roads.

Zhouqu's reconstruction is projected to cost a total of 5.02 billion yuan, with funds for reconstruction earmarked by central, provincial and county governments.