The first phase of major regeneration works set to see the construction of a total 105 new homes is set to begin as soon as early 2026, the council has said.
Developers will move on to the former Fourth Street site in Horden in the coming months after Durham County Council gave plans the green light on December 3.
The open space will soon hold 16 homes as part of £10.7m plans that will also see a total 112 homes on Third and Fifth Street reduced to rubble to make way for 89 homes.
It was previously reported that 110 homes would be demolished, but this number has since been corrected by the council.
Currently, the council owns 18 homes on Third Street and 17 on Fifth Street - with demolition works only set to take place when the council have negotiated with landlords and current residents.
The scheme, first announced in 2019, has been branded a "catalyst for change", spurred on by one in ten homes standing empty and boarded up, and the area is plagued by anti-social behaviour.
Mike Allum, Durham County Council’s strategy and delivery manager, said: “Securing planning permission for more than 100 new, high-quality homes is a major milestone in the delivery of the Horden Masterplan.
“The plan aims to regenerate the village and improve life for local people by tackling challenges such as the high number of empty properties in the area owned by absentee landlords, paving the way for new council housing that is truly affordable.
“Now that planning permission is in place we are continuing to work closely with owners and landlords to negotiate the purchase of properties in Third and Fifth Street.
“We are also supporting residents to find alternative accommodation. This will include establishing a local lettings scheme to ensure eligible residents on Third Street and Fifth Street are given priority for the new council housing built on the site.
“We anticipate that work will begin on the former Fourth Street early next year, with the redevelopment of Third and Fifth Streets to follow once we have acquired the remaining properties and land.”
On the day plans were approved, more than a dozen came out to protest the plans, holding placards outside the council's HQ.
The council say that residents who will lose their homes will be put to the top of the list for new social housing, but many emphasised they wanted the homes to be refurbished rather than demolished.
In the meeting, councillors heard from David Ramos, a resident of Fifth Street who spoke passionately against the plans, emphasising the community "do not want their homes to be destroyed".
He said: "This is not just a planning application, it's my life.
"I never thought I'd have to move again, but here we are. We are asking you to refuse the plans or defer them before 110 perfectly good homes are lost forever.
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"This is a wonderful community that would be torn apart by what is proposed here. I'm living with constant uncertainty. I don't know what's going to happen."
But even when the plans were approved, one resident, Moira Bellingham, was adamant that she will up a fight.
Moira, who has lived on Third Street for 60 years with brother Ray, told the Echo: "They can send the bulldozer straight through the house and I'll still be stood there.
"They will have to kill me."
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