The construction will be completed by housing developer Sanctuary Homes for 44 properties in Portsoy.
The £3.9 million grant from the Scottish Government will help fund the project on the former Campbell Hospital site in the town.
Since 2016, a target has been set to build at least 50,000 new affordable homes, of which 35,000 will be for social rent, with investment of more than £1.75 billion.
In comparison, the number of social homes being built by the UK Government under the Tories has fallen by almost 90 percent since the Tories came into power in 2010.
Commenting, Stewart Stevenson MSP said:
“The Scottish Government is doing all it can to support decent, affordable housing in the North-east.
“Not only will it help to provide homes for people, it shows the Scottish Government’s commitment to improving infrastructure in the region, creating jobs and investment.
“While the SNP have delivered more affordable homes, the level of social housing available in England has continued to plummet under the Tories.
“The Scottish Government remains committed to helping people feel settled and giving them fair access to property at an affordable level.
“In this Parliamentary term, we have set a target to build at least 50,000 new affordable homes, of which 35,000 will be for social rent, with investment of more than £1.75 billion.”
“Not only will it help to provide homes for people, it shows the Scottish Government’s commitment to improving infrastructure in the region, creating jobs and investment.
“While the SNP have delivered more affordable homes, the level of social housing available in England has continued to plummet under the Tories.
“The Scottish Government remains committed to helping people feel settled and giving them fair access to property at an affordable level.
“In this Parliamentary term, we have set a target to build at least 50,000 new affordable homes, of which 35,000 will be for social rent, with investment of more than £1.75 billion.”