In case of urban renewal of a substandard residential area with new housing including the relocation of 200 or more occupied dwelling units the unit of government in which the project is located shall assure available land or housing for either rental or purchase in the same general area by low and middle income families. The urban renewal shall proceed in such a manner as to assure after a part of the area has been cleared that such housing shall be provided and ready for occupancy before any further removal of residents of the area. Residents of the area faced with relocation may relocate elsewhere as provided in section 1 or on a priority basis in the new housing provided under this section.