A village green and a community house - complete with a kitchen, dining area, extra accommodation, laundry, library, and even a nearby swimming pool - will form a central hub to the project, he said.
The houses will face the communal area but also have courtyards at the back for privacy.
Each one will be built with high levels of energy efficiency, he says.
"We want places that look and feel good but, at the same time, are modest in size. We want to encourage simplicity," Davison said.
Residents can work with the eco-village's architect to build a house that meets their needs, he said.
"We're looking forward to offering a way of living that is sustainable, not only in the sense of the materials we that we build with but also in terms of living with our neighbours and being supportive," Davison said.
With the site just a 10-minute stroll from the city centre, and right next to the shared Kamo pathway, "we expect walking and cycling to be the norm - that's healthy for individuals and better for the environment".
Solar power and electric vehicles are part of the vision but, in the meantime, the focus will be clearly on "getting the ball rolling".
While urban co-housing is fairly common in Europe, with more than 600 examples in Denmark, New Zealand only boasts three, including Earthsong In Auckland and High Street Co-housing in Dunedin.
If interested the Ahi Wai Eco Neighbourhood project, visit econeighbourhood.co.nz
