Palmerston North's first social housing development in more than three decades is hoped to set a standard for private landlords to follow.

"Social housing provides housing for some of the vulnerable people we've got in our community," Palmerston North City Councillor Susan Baty said.

"It means they can have some subsidised rents and enjoy a good quality of life. They've got a home for life, they never have to be kicked out, so that means they're safe, secure."

Thirty-two old units are being bulldozed to make way for 50 new ones in Papioera Place.

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Helen Williams, one of the first people to take up residence in the development, was looking forward to the change.

"It's going to be warmer - and I hope our power bills will be a lot less," she said.

And she had already been meeting new people.

"It's made people who haven't really said 'hello' to you, say 'hello'."

Baty said the new designs would be putting the 'social' back into 'social housing' after older properties ended up being the opposite.

"Because they were so old, not comfortable, cold - people kind of shut themselves away," said Baty.

"And they were on quite big sections. Now we've compacted them and the design of them means, when they come out of their front door, you can't help but notice the other neighbours."

The move to Papioera Place was straight-forward. The new build was close by for most of the 48 tenants.

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"Because we changed the footprint, we built the first 30 in front so we didn't need to transition all 48, only a portion," Baty said.

While the rimu flooring was worth saving, the old units weren't, with an estimate of more than a $120,000 to upgrade each unit to a modern standard.

With more 400 units in it's portfolio the council said buildings such as Papioera Place represent the future.

"I think it's really important because it's setting a standard for other private landlords," said Baty. "This is a really good model for housing and ... this is the standard we want."

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