A new partnership could see more than £3m pumped into plans to create more than 1,500 new affordable homes for the Wakefield district.
Wakefield Council is working with Wakefield and District Housing (WDH) on the joint venture and will be drawing up a plan of action in an effort to meet housing targets.
The council’s key decision makers will meet next week to discuss the partnership and what it will mean for people living in the district.
The venture is aimed at creating homes to sell and rent to meet the Local Development Framework target of 1,600.
The homes will be a mix of affordable rented property and homes for sale with shared ownership arrangements.
Any profits will be reinvested into the partnership.
Coun Peter Box, leader of Wakefield Council, said: “This new venture is moving forward and we are working to together to establish a plan of action.
“By working with WDH, we can reinforce the council’s commitment to creating new and affordable homes in the district, at a time when the private sector is struggling to do so.
“We are still in the early stages but I hope that by working together over the next few years we can create new homes and provide training and job opportunities for local people.”
Kevin Dodd, chief executive of WDH, added: “We are delighted to be developing this joint venture with the council.
“A strong partnership between us and the council is very important for not only delivering much needed new homes in the district but also in supporting the local economy.”
The scheme is due to run for five years, with a mid-term review, and both the council and WDH will bring resources to the new project.
Council chiefs say they will be supporting the delivery of housing with between £1.5m and £3m of council resources, which may include a small number of housing sites.
WDH will also make a similar cash contribution.
A report to the council’s cabinet sets out the proposed structure for the plan, leading to a final decision in June 2013.