The Ministry of Urban and Rural Development will allocate N$75 million for land servicing and construction of houses at Farm 37, near Walvis Bay.
Farm 37, also known as Green Valley, is located about seven kilometres east of the harbour town.
In 2016, the late Erongo Governor, Cleophas Mutjavikua, pushed for Farm 37 to be identified as a solution to the housing shortage at Walvis Bay.
Since then, the municipal council has been mobilising funds to develop the land.
Council said although the area is not fully developed, there is access to sewerage, sanitation and water services for the residents, who mainly consist of fire victims and former backyard tenants.
The municipality resettled close to 170 residents, while hundreds of members of the Backyard Tenants Group have moved to portion 19, allocated to them.
Walvis Bay Mayor announced at a council meeting recently that the Ministry of Urban and Rural Development allocated N$75 million to develop Farm 37.
Trevino Forbes said 1,500 erven will be serviced at Extension proper, while part of the budget will go to the construction of low-cost housing.
A temporary sewer oxidation pond is expected to be constructed, the mayor revealed.
Forbes indicated that the project will be executed within nine months, with work having started last month and expected to end in February next year.