Inventory issued to Contractors for Capital project

As per AS 7-16.B, all material costs will be accounted as material and contractor costs as supervision costs in their respective books. But you have to follow the Stage of completion method to recognise revenues and expenses, tat is, if you are developing and selling homes. If it is for your own, then treat them as inventory and contractor fees.

Purchases a/c

To Creditor a/c

and 

Creditor a/c 

To Bank a/c

and you can create a ledger named Contractor as a creditor and pass on these entries

By Inventory xxx amount in contractors book on the Credit side

To Contractor xxx amount in Inventory book on the debit side

This should work out because there are fixed price contracts, cost plus contracts where you are not required to provide any material, but just pay for it due to accounting complexities.

If your building something for your own company

Then,

Contract fee expense a/c

To Contractor a/c 

and use WIP accounting separately.