Demolition work has started on Napier Court in Wisbech.
Building contractors Mansell moved in last week to start knocking down the complex, which belongs to Circle Housing Roddons.
The housing provider is working with Mansells to build 24 new affordable homes in Napier Court, Wisbech. The site will now be turned into a mixture of flats and houses, all for affordable rent.
Circle Housing Roddons are also starting work on The Dale– a £2.5m development of 21 houses in Elm which are also for affordable rent.
Homes on the new development are among nearly 300 being built by Roddons within the next two and a half years.
Circle Housing Regional Operations Director Christopher Smith said: “When Circle Housing Roddons formed in 2007, we promised to invest in new homes.
“The new homes at Napier Court and The Elm are part of our commitment to building new and affordable homes in Fenland.”
The homes are due to be completed by December 2014.