Plans have been submitted to the city council for the vacant premises which until recently was the base for a charity supporting rough sleepers.
According to the application from Lioncross Peterborough LLP, the detached two storey building would be transformed into two separate buildings, largely three storey in height.
However, some of the properties would be kept at two storeys to maintain existing sites of the cathedral.
The Garden House is situated in the north-west corner of the precincts and was once part of the extensive gardens of the Deanery.
The site is accessed off Midgate, via Wheel Yard.
The application states that the site has been allocated for 25 properties in Peterborough’s Local Plan - which outlines future development in the city - but that reducing that number to eight “has been welcomed” by Historic England and the council’s conservation officer.
According to the plans, three of the new homes would have two bedrooms, while five would have three bedrooms.
The Garden House is not a Listed building itself but still requires Listed building consent to be demolished.
The site is said to be in “poor condition” with structural cracking identified, with the applicants stating: “The proposed development will provide a high quality scheme that contributes positively to the historic character and appearance of the area and provides eight useful family dwellings.
“The development of the site will continue to contribute to this tranquil and private part of the wider Cathedral Precincts, continuing to provide a transition between the ecclesiastical character surrounding the cathedral and the busy city centre beyond the site to the north.”
A heritage impact statement issued as part of the application states that the proposed development would not affect views of the cathedral and that the impact of the demolition would be “low adverse” and outweighed by the benefits.
The Garden House was the home of a charity bearing the same name which is run by Light Project Peterborough.
The charity, which works closely with homeless people in the city, providing support, friendship and a place to stay, moved to Archdeaconry House on Gravel Walk, a building also on the cathedral grounds, in April.