The Queen is making plans to hand over the Anmer Hall on the Sandringham Estate, her country home, to the Duke and Duchess of Cambridge, the Daily Mail reported.
The late Georgian country house sits in the grounds of the Sandringham estate and is just two miles east of the Queen's Sandringham House.
The Duke spent much of his childhood holidays exploring the Grade II listed house, which has been part of the estate since 1898, and its grounds and has fond memories of the mansion house.
"The house has been earmarked for William and Kate," a royal source said.
Anmer Hall, which between 1972 and 1990 was lived in by the Duke and Duchess of Kent, is currently leased to James Everett, who owns a kitchen and timber company, until 2017.
When the Duke and Duchess of Cambridge are not at their Anglesey farmhouse, they live at Nottingham Cottage, in the grounds of Kensington Palace in West London, which has just one bedroom and has been described as 'cosy'.
However, later this year they will move into the newly renovated Apartment 1A inside the palace itself, which was Princess Margaret's home, and Prince Harry will have their old apartment.
The Queen and the Duke of Edinburgh stay at Sandringham every Christmas with the rest of the Royal family.
The newly renovated home will be perfect for the couple's new addition as it boasts five bedrooms and three reception rooms.
It is understood that the Duke is particularly delighted about the houses because he and Kate spent their first Christmas as husband and wife at Sandringham in 2011.
The 20,000-acre Sandringham estate near King's Lynn in Norfolk has been owned by the Queen since her accession in 1952 and by the Royal Family since 1862.
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