Castletown Commissioners are seeking planning permission to build 133 homes on School Hill and West Hill.
It says the development would be a mix of public sector housing, open market and affordable housing, which could cost an average price of £155,000.
The local authority says in a planning statement that this application is to replace the older stock that needs updating.
Four of the planned homes will be suitable for disabled use and the development plans to have a mix of bungalows, apartments and houses.
10 of the 39 open market houses are planned be listed as affordable housing.
A children’s play area and green space are also going to be provided.