Joseph Rowntree Housing Trust is seeking a contractor to build the second phase of its Derwenthorpe community which it is building on the edge of York.
It today issued a tender for the construction of between 123 and 130 homes, for which it gained planning permission in April.
The selected developer may also be asked to provide major infrastructure works on the site.
The three-year contract, worth between £22 million and £25m, will be a mix of affordable housing managed by the trust, and homes for private sale.
A development agreement will include obligations to provide environmental and social benefits.