* Iraqi forces set to take full control of city 'in hours'
* Fighting with Islamic State has displaced almost a million
* Camp residents contemplate rebuilding shattered lives
By Isabel Coles
HASSAN SHAM CAMP, Iraq, July 8 (Reuters) - Victory over Islamic State may be close at hand in the battle for Mosul but many of the almost one million city residents displaced by months of fighting are in no mood to celebrate.
At a camp sheltering a fraction of those who have fled eight months of combat between Iraqi forces and Islamic State militants, the main concern is keeping cool without electricity as temperatures climb above 40 degrees Celsius (104 degrees Fahrenheit). Some of the displaced people living at Hassan Sham camp east of Mosul are selling food rations in order to buy a more precious commodity: ice. A small block measuring roughly a foot long (30 cm) sells for 500 Iraqi dinars ($0.43).
Standing in the ice queue, some camp residents said they would be happy to see the back of the militants, who subjected them to three years of violence and privation, but questioned how they would rebuild their lives in a ravaged city.
Most have lost their livelihoods, many have lost homes and relatives too. "There is nothing they (Islamic State) didn't take from us," said Mohammed Haji Ahmed, who arrived at the camp just five days ago from the Souq al-Shaareen neighborhood in Mosul, where Iraqi forces are fighting to dislodge the last militants.
The clothes trader lost his house, his car, his business and 15 members of his extended family as a result of Islamic State's occupation of Mosul.
"If there is no rebuilding and people don't return to their homes and regain their belongings what is the meaning of liberation?" he said.
'SAFER HERE THAN THERE'
After three weeks of fighting in the narrow streets of the Old City where Islamic State is making its last stand, state TV said on Saturday that Iraqi security forces expected to take full control of Mosul in the coming hours.
The final phase of the battle has proved the bloodiest, with Islamic State trapped in a shrinking corner of the city.
For displaced inhabitants, the ordeal may soon be over but the future remains uncertain.
"There is no work there (in Mosul) and the situation is still not stable," said Hussein, 18, who has fled Mosul twice this year.
He first left the Tanak neighborhood when it became a front line in the battle, but returned, only to leave again around three weeks ago. Islamic State staged a counter-attack in the area just days later.
"It's safer here than there," he said.
Many at the Hassan Sham camp are from the eastern half of the city, even though it was retaken in January and normal life has to some extent returned there.
Aziz Ahmad, 43, said he would return to Mosul if he could, but cannot afford the fare back to Mosul, let alone rent a place to live in the city, where increased demand for housing has pushed up prices.
Younis Idrees, 20, fled the Aden district four months ago fearing Islamic State sleeper cells and bombings.
"Unless the situation improves we won't return," he said. "It's not clear what will happen." ($1 = 1,167.0000 Iraqi dinars)
(Editing by Helen Popper)