Civic leaders have previously said they are aiming to develop 500 new affordable properties a year by the middle of the decade for residents on lower incomes.
Now two sites have been earmarked for the first such homes with work expected to start on some 200 new properties within the next 12 months.
It will make the north-west council one of the biggest local authorities yet to begin constructing its own in-house homes again in response to growing shortages and rising homelessness across the country.
Others – including Norwich, Bristol and Doncaster – have already taken the same action.
Gavin White, the Labour authority’s executive member for housing, said local authorities had been “stymied” for years from “accessing the proper funding to building homes at scale to meet ever growing demand”.
But the new plans will see both a mix of affordable and market rate homes built - with money made from the market rate properties then pumped into building even more affordable home.
Councillor White said: “Making sure there are enough decent and affordable homes for our residents is a key priority for the city.”
A new company, This City, has been set up to deliver the two new neighbourhoods.
One, at an unannounced site near Ancoats, will see some 122 townhouses and apartments created. The other in Piccadilly will have 82 homes.
The plans were revealed in a report presented to the council’s executive on Wednesday.
“This City is initially going to build homes on council-owned sites which have remained vacant for a number of years providing net new supply housing in areas where demand is high,” it said. “It is intended that there will be an element of family housing provided across the majority of schemes delivered…
“This will diversify the housing market and develop mixed communities across a range of housing market areas.”
Critics however remain unconvinced by the action.
They say that the 200 properties – a portion of which will be rented at market value rates rather than being affordable – does not go anywhere near far enough to dealing with the issue of homelessness in the city.
Tens of thousands of council homes were built across Manchester - and the UK - between the 1920s and 1980s when Margaret Thatcher’s government reduced the cash available for such homes.
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