Stone Circle is a wholly owned subsidiary of the council that was set up for the benefit of Wiltshire residents.
It is comprised of the holding company, Stone Circle Development Company and Stone Circle Housing Company, which purchases residential property.
The company plans to buy a further 21 properties in Salisbury, Trowbridge and Chippenham.
The council said that it is meeting a range housing needs that ‘cannot be easily addressed’ including a lack of accommodation for key workers.
A spokesman said: “The quality and cost of these developments could be improved by private rented sector accommodation provided by a local housing company, which is what the Stone Circle Housing Company was established to achieve.
“The development company also enables the council through its company to undertake residential developments that, subject to planning permission, could deliver more than 500 units of accommodation over the next three years, and also increase the potential return that could be generated from the developments, for the benefit of Wiltshire residents.”
Richard Clewer, cabinet member for housing said: "We have already made great strides in creating hundreds of affordable homes across the county.
"However, this private housing company provides more flexibility in offering homes to a wider range of people in the county.
"There are some areas where we may need to provide housing with fixed term tenancies, potentially linked to care worker jobs or for care leavers.
"Stone Circle Housing Companies will help us meet this wider housing need and provide that greater scope to do more, while generating a revenue return for the council."