Councillors will discuss one pilot site, and another two that could be used in the future. They will also be asked to agree a funding package that would see the pilot site in Shoeburyness developed with between 13 and 27 homes.
Longer term options and ways of building more council homes could also be explored by officers, including through creating a council owned development company.
The report to cabinet follows an in depth scrutiny project in 2013 and the assessment of over 100 small pieces of land owned by the council.
Cllr David Norman, executive councillor for adult social care, health and housing says: "This is an exciting opportunity to build new council homes for the first time in decades and to begin to tackle the urgent need for good quality low cost accommodation in the town.
"Whilst more work needs to be done on looking at long term options for council housing, we have development funds available to pursue this pilot scheme. Part of this is time limited money including right to buy (RTB) receipts and section 106 planning contributions that if not spent will be handed back to central Government.
"We are committed to addressing local housing need and this pilot scheme could create between 13 and 27 new council homes that will be available for local people on the home seekers register.
"The pilot site suffers from anti-social behaviour and cases of fly tipping and so this is also an opportunity to regenerate that site. We recognise that there are some local parking issues that will need to be addressed as part of the planning and development process.
"Two other sites have been recommended which could be built in the future creating up to 33 further council homes."
An indicative timetable shows that if community consultation could take place at the end of the Summer with the pilot project completed by November 2015.
The pilot site in Shoeburyness is a collection of underused and disused garage sites and is similar to other sites the council have bought forward with registered providers.
The project could cost between £1.5m and £3m depending on the number of homes built, which will be decided following consultation with the local community and councillors. Thirty per cent of the costs will be funded through RTB receipts, £66,000 from section 106 and the rest from HRA capital investment reserve.
It is proposed that the first phase will be let at 80% market rents on an assured short hold tenancy to maximise rental income.
If approved at cabinet next week, a report will be prepared for Full Council.