The five bungalows at Trinity Road, Stamford, comprise a one-bedroom and a three-bedroom property, with three two-bedroom properties.
Cabinet Member for Housing and Property, Cllr Robert Reid, said: "One of the key ambitions of SKDC's Corporate Strategy is to increase the supply of high quality, sustainable, social housing.
"SKDC is moving from traditional construction methods, which are typically less sustainable and take longer to construct, to modern methods which exceed industry standards for construction time, ensuring homes are delivered more quickly, with enhanced energy performance and to meet the lifestyle choices of the tenant.
"Our ongoing programme of house building will ultimately help prevent homelessness and overcrowding by providing some of the new homes that are so badly needed across the district.
"We are pleased to be able to bring homes to those on our Housing Register, this latest development in Stamford supporting recently completed schemes in Bourne and Grantham."
South Kesteven District Council Leader Cllr Kelham Cooke said: "By building new homes ourselves, we can focus on particular needs such as accessible homes and help meet a growing demand for affordable housing".
"This development also features a range of measures to ensure this housing is highly energy efficient which will reduce the energy consumption of the properties, helping future tenants save on their energy bills.
"Our construction programme will benefit from our experience on this project and through our relationships with other local authorities with our next major site being Swinegate, Grantham. This is a sheltered housing scheme for 20 units in Grantham town centre and will be SKDC's flagship development for technology and material standards."
Three of the properties have been built with full disability access and all are built to lifetime home standard, which means they can be easily altered to support a range of mobility requirements.
This development has also improved parking for existing residents as well as creating new parking spaces for the new homes.