The contractor is to build a total 116 affordable homes across two projects in Salford and Bury.
In Salford, Watson Homes has been selected to construct 91 properties for Salix Homes, part of a wider 157-home development.
The announcement of the contractor comes after Salix Homes secured £3.3m from Homes England to help finance the scheme.
The homes being delivered by Watson will be available for social rent and shared ownership.
Salford Council is to purchase 25 of the homes for social rent, while a further five properties will go to Inspiring Housing Community Land Trust for a community-led housing model, which aims to support affordable homes for local people.
Step Places, Salix’s joint venture partner, will deliver the remaining 66 properties for market sale.
The project, known as Neighbourhood, will comprise a mix of two-, three- and four-bedroom houses and one- and two-bedroom apartments built on two brownfield sites off Kara Street and Liverpool Street in Seedley.
Terry McBride, development manager at Salix Homes, said: “The appointment of the contractor for Neighbourhood and the confirmation of Homes England funding marks the next important milestone for this ambitious scheme, and we can now look forward to seeing our vision for a new era of housing in Salford brought to life.”
Rob Watson, director of Watson Homes, said: “We have always been committed to working with housing association partners to build affordable homes in the places where they are most needed. As a Salford business, we can’t wait to bring this ambitious project to life for Salix Homes, creating a thriving, new community for local people.”
The development is expected to complete in summer 2023.
In Bury, Watson has been appointed to build 25 affordable homes for The Averill Group and Irwell Valley Homes.
The homes will be built on a two-acre plot on Morris Street in Radcliffe.
Watson Homes has a track record of working with housing associations to deliver affordable homes across Greater Manchester, including ForViva’s 103-home The Willows, and the 58-home Melody Gardens for Places for People.