The City of Lincoln Council will build five more council houses in the city, which will be available to rent.
The proposal was approved by the council executive on January 7.
The sustainable homes will include three three-bedroom town houses each with three storeys, and two two-bedroom bungalows.
The council identified a site for the homes on Stapleford Avenue in the Ermine, which is in its ownership and a planning permission for a housing association was granted in September 2009.
However, the housing association did not build the development due to funding shortfalls and planning permission expired in September 2012, so a new planning application will be required.
The Wellington Street development in Lincoln was the first new council houses project since 1990, and this was completed to code level 4 of sustainability with solar panels and high-spec insulation.
The council will build the new homes to the same specifications, and the project will cost just under £500,000.
Lindum Construction built the five Wellington Street council houses in 2012 and will build the five new properties as well.
Ric Metcalfe, Leader of the City of Lincoln Council, said: “Getting more people into affordable housing is one of the council’s highest priorities.
“These five new homes will give us the opportunity to get people off the council house waiting list, and offer support to people currently struggling to pay high rents in the private sector, often in overcrowded conditions which affect their health and well being.
“Further phases of this bold new programme are planned in future years,” he added.
There are more than 3,000 people on the waiting list for council homes in Lincoln.