About 10,000 people were evacuated from Ambae three months ago to escape the impact of an erupting volcano.
Many have been temporarily housed on Maewo and the Vanuatu Government, with help from New Zealand, is starting a programme to provide proper housing.
New Zealand is giving $US77,262 for building materials for 22 houses, six shared toilets, and a community rainwater harvesting system.
The Daily Post reported the construction would utilise the skills and expertise of the Ambae and Maewo people who have already worked together to construct existing temporary shelters.
To date New Zealand has provided just over $US4 million for those displaced by the volcano.