A further 152 one, two and three-bedroom apartments will be built in Carseldine, in Brisbane's north, to accommodate residents with lower budgets.
The units will cost the government $87 million and are expected to be completed by 2026.
"It's sending a signal to the rest of the property market ... this is what the homes and the urban renewal projects of the future need to look like," Premier Steven Miles told reporters on Wednesday.
The announcement is an expansion of the existing complex of social and affordable homes in the area.
Local MP Bart Mellish and Premier Steven Miles see Carseldine Village as an affordable solution. (Jono Searle/AAP PHOTOS)
Carseldine Village, once all five stages are completed, will have more than 600 units available as well as green spaces, a supermarket, specialty retail and dining.
The precinct is also close to schools, a swimming pool and the train station.
"We need affordable housing in Brisbane, and we can either have them living halfway to Gympie in sort of endless urban sprawl, or we can put them near train stations where people want to live," Transport Minister and local member Bart Mellish said.
Carseldine Village resident Dino Sakhla commended the government on the precinct and the community it has created.
"We have a very vibrant community. We have multicultural people living here, many young families coming here," he told reporters.
"When these things are built, we will have more families of (different) social backgrounds coming together."
Home prices have soared in Queensland in recent months, with Brisbane ranking the second-most expensive city to buy a house in Australia.
Affordable housing is a key election battleground as the Miles government has promised 53,500 social homes by 2046.
The Liberal National Party has also made affordable housing election commitments, promising to have the same number of social homes as Labor but delivered two years faster.
The opposition has also committed to opening up approvals for faith-based land to be used for social homes, potentially providing 10,000 properties by 2044.
The LNP is tracking ahead in the polls to win the October 26 election, overturning Labor's three terms in government.
12°C