Designs for a new Blackfriars End at Edgar Street should be drawn up by the end of the year, according to landlord Herefordshire Council.
Demolition work is set to take place over the summer, with the council currently searching for a contractor.
The council's vision is to build more student accommodation, as well as for key workers, at the Blackfriars End and also Hereford College of Arts' College Road campus. This would support the art college but also the city's new university NMITE and staff education and training placements at Wye Valley NHS Trust, which runs Hereford County Hospital.
In an update on Tuesday, the council said it is working with partners, including the football club, to develop proposals for new student accommodation in Hereford to enhance the experience of higher education in the county.
Work to develop the proposals is set to be completed by the end of the year and the council's cabinet will then take decisions on the preferred financing model to further develop the sites.
In a council report last week, first reported by Bulls News, the council said the county faces a number of "significant economic challenges" such as wages being 19 per cent below the national average and productivity 27 per cent below the national average.
More than a quarter of people who live in the county are also aged 65 or over and there is a lack of higher education opportunities which drives younger people to leave the county to study elsewhere.
Chris Ammonds, Hereford FC's chairman, said: "It is very exciting to hear about plans to redevelop the Blackfriars End at Edgar Street as it is something that has been talked about for many years.
"We are pleased to be working closely with Herefordshire Council as the proposals are finalised and it is great news that there is a firm commitment to returning Edgar Street to a four-sided stadium as part of the development.
Abigail Appleton, principal at Hereford College of Arts, said: "We are immensely proud of the quality of accommodation that Station Approach, developed with Herefordshire Council’s support, already offers degree students coming from across the UK to study at Hereford College of Arts and we’re delighted that the council is now exploring options to expand the provision available for higher education students studying with ourselves and our partners in the city.
"Alongside distinctive, high-quality, professionally focussed programmes, there’s no doubt the availability of accommodation is an important factor in student choice, and should help attract more students to develop their skills, creativity and careers here, contributing to our city’s sustainable growth.
James Newby, president and chief executive at NMITE, said: "We are very excited by these plans and by the prospect of working with the council and our friends at the Hereford College of Arts and Wye Valley Trust to help deliver the vision that Hereford can be a vibrant university city.
"These important new facilities will enable our students to live and work with their counterparts at the HCA and WVT, and to play an active role in the community. The plans will help drive economic growth, create important new educational opportunities and support local employers and communities."
Alan Dawson, chief strategy and planning officer at the Wye Valley NHS Trust, said: "The trust has been working with partners to deliver accommodation for students for several years. Major increases in NHS students and trainees over the coming years will require accommodation in the city and the Trust is pleased to be able to continue to continue this work to deliver for the NHS workforce of the future. This development to increase student accommodation aligns well with the trust’s proposed new education centre."