The first two houses arrived at the vacant Ranolf/Malfroy Rd site this morning.
The site was purchased by Kāinga Ora last year to help meet the high demand for housing in Rotorua.
Thirty-seven new homes will be built for the vacant 2h site as well as a community room and shared green space.
A Kāinga Ora spokeswoman said the first two houses were scheduled to be brought by truck early this morning from the BuiltSmart factory in Huntly where they've been built and fully fitted out.