The ground has been broken on a scheme to build 152 new homes at De Montfort Place off Clapham Road.
Work starts in time with Bedford being voted the third hottest property market in the UK by online estate agents eMoov.
The development is made up of luxury properties ranging from one-bedroom apartments to five-bedroom homes with a landscaped communal green.
Mayor Dave Hodgson and councillor Colleen Atkins MBE attended the ceremony with senior staff from developer Storey Homes.
Cllr Atkins said: “I’m delighted work on this significant development has started and we look forward to the much needed homes being lived in.
“Warwick Avenue is an attractive, tree-lined street with Victorian houses so it is important that the design of De Montfort Place is in keeping with the conversation area.
“As ward councillors, we took an active interest throughout the planning stages to make sure it will bring improvement to the street scene and that important trees were protected.
“I’ve been involved in the future of the site for over ten years so it’s a great occasion that the project has finally come to fruition and I’m pleased to be part of the ground breaking ceremony.”
Katy Jordan, managing director of Storey Homes, said: “We were delighted to be joined by the Mayor of Bedford and all our guests to officially mark the start of work at De Montfort Place.
“This exciting new development will help regenerate the area, and revitalise this key strategic site, delivering greatly needed new homes for the local community.”
The first new homes at De Montfort Place have recently launched. Guide prices range from £165,000 for the apartments and £450,000 for the houses. Help to Buy is available on selected properties. To register your interest, visit www.storey-homes.co.uk or call 01582 742165