Aspire Housing is developing the derelict land in Lower Ash Road, to create affordable housing for sale and for rent.
The pub site was bought in 2013 and cleared to make way for much-needed regeneration.
22 new properties will be built, with a mix of different styles and sizes. There will be six two-bed bungalows, ten two-bed houses and six one-bed flats.
Contractor ‘Novus Property Solutions’ will carry out the construction, and the development is expected to complete in 2017.
Once the homes are built, they will be a mix of seven shared ownership and 15 affordable rent, with a price range for the shared ownership homes of between £115k and £125k.
The development is being financed by Aspire Housing with support from the Homes and Communities Agency which has contributed £616,000 towards the build.
Sinéad Butters, Aspire Group Chief Executive, said: “We are proud to be working with Novus Property Solutions to regenerate this area by creating attractive and affordable new housing.
“In the past the site had attracted interest for all the wrong reasons, the former pub had become an eyesore and a magnet for anti-social behaviour.
“But we are transforming it to create housing which is in high demand. The shared ownership units are expected to be very popular and will help people get that step onto the property ladder.”
Novus Director Alan Nixon said: “We’re delighted to be working with Aspire Housing on this project and look forward to playing our part delivering high quality housing to the area.”