State housing provider Kāinga Ora will soon apply for resource consent to build more than 60 homes on a 10,000-square-metre site in central Palmerston North.
It paid $6.36 million for the Church Street site, between Albert Street and Victoria Avenue.
"We are working through final designs, and reaching out to our partners to receive their feedback and input into our Church Street development," said Graeme Broderick, Kāinga Ora's regional director.
"Once our designs have been completed and before we apply for resource consent over the coming months we will be going back to the community to show these designs and talk through any questions that the community may have."
The site has been cleared of older houses over the past few years.
Any development could go some way to reducing the growing waiting lists for housing in Palmerston North.
The waiting list for Kāinga Ora homes in the city is 659 households, up from 439 in February 2020. For city council social housing the waiting list is 504, up from 312 over the same period, and made up of 370 singles and couples and 134 families.
Broderick said Kāinga Ora had built 98 new homes in Palmerston North since 2018.
It had 10 under construction across two developments, and 180 in the design stages.
"This includes projects such as our 62-home development on Church Street and our 58-home development on Rugby Street," he said.
Feasibility studies were happening on another 14 sites, covering more than 170 homes.
The Rugby Street land was owned by Kāinga Ora. It had removed older, earthquake-prone houses from the site that were no longer fit for purpose.
"This is part of our development programme, where we are demolishing existing older houses on larger sections and replacing them with a greater number of newly built warm and dry homes," Broderick said.
"For example, older state homes tend to be two and three-bedroom homes designed to meet the need at that time, and what we generally need now is a mix from one-bedroom homes for single people and couples, through to four and five-bedroom homes for larger families."