East Devon District Council has submitted plans to build eight new flats off Dinan Way.
The site is currently occupied by properties at 24 and 26 Normandy Close, which would be demolished.
EDDC says the development is necessary as the existing homes are beyond repair, owing to major subsidence.
The council also says the eight flats will be designed to reduce overbearing on neighbouring properties, and will have parking spaces provided.
Exmouth Town Council will be consulted on the plans, before EDDC’s planning committee makes the final decision.
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