This first one will be a three-bedroomed, two-storey property with off street parking behind 159 Bournemouth Park Road, Southend.
Essex-based company Kingdom Facilities & Construction won the contract to build the house designed by architects AK Design, and work is already under way.
Executive Councillor for Adult Social Care, Health and Housing, Councillor David Norman said: “We undertook a review of council-owned land in the borough, as part of our commitment to provide affordable homes for residents.
“We very much need to increase the borough’s affordable housing stock.
“When this land behind Bournemouth Park Road was explored, it became clear that there was room to build a house there – Southend’s first new Council residential property since 1989.
“We hope it will be completed and handed over ready for people to move in to, by the end of this year.
“We also hope this will be the first of many and are currently investigating building more affordable homes on Council-owned land at Ashanti Close, Bullock Road and Exeter Close in Shoeburyness.”