Thousands of squatters have started moving out of an abandoned skyscraper in Venezuela, dubbed the world's tallest shanty-town.

Soldiers in Caracas have started moving out the more than 1,150 families living in the 45-storey 'Tower of David', which was taken over by squatters in the 1990s.

Originally intended to be a bank centre but left unfinished in 1994, the vast concrete skeleton was viewed by many Venezuelans as a focus for crime and symbol of property "invasions". Police occasionally raided it, hunting kidnappers.

Day one of the removals saw 160 families pack their belongings and leave their homes in the slum tower. ( AFP: Federico Parra )

President Nicolas Maduro says the residents will be moved to government-provided, low-income housing outside the capital.

"The Tower of David is famous. It's a symbol of a strange situation, a vertical 'barrio'," Mr Maduro said. 'Barrio' is a Spanish term for neighbourhood.

"It was viewed negatively by society. We resolved it, as these things should be resolved, with dialogue and understanding."

Since squatters moved in to the building two decades ago, they have built apartments, shops and created a makeshift community. ( AFP: Federico Parra )

The squatters said the tower was a safe refuge from dangerous slums and something of a model community.

They built carefully divided apartments and established shops and services inside, bricking up holes to keep children safe.

The tower fascinated foreigners. An exhibition about it won a prize at the 2012 Venice Architecture Biennale, and it even showed up as a backdrop to an episode of US TV drama Homeland, as the place where on-the-run terrorist suspect Nicholas Brody was captured.

People wait to leave the Tower of David, an abandoned skyscraper in Caracas that became a 'vertical slum', on July 22, 2014. ( AFP: Federico Parra )

Mr Maduro said it was an error to let people live so long in such a precarious structure, where some people died falling off ledges. The state is studying various options for the tower.

"Some are proposing its demolition, others are proposing turning it into an economic centre, some are proposing building homes there," Mr Maduro told reporters.

"We're going to open a debate ... If we demolish it, it's to build something new for the local community."

Mr Maduro's minister for the transformation of Caracas, Ernesto Villegas, said he leaned towards demolition of the building because it was a monument to a "bourgeois" past before the 1999-2013 rule of socialist leader Hugo Chavez.

After two decades as a slum, there is speculation the building will be picked up by Chinese interests. ( AFP: Federico Parra )

In a second day of frenetic activity at the tower, residents hauled down couches, beds and other belongings, and soldiers helped them load trucks heading to their new homes.

The squatters said they were leaving voluntarily after advance meetings and guarantees of new apartments.

Local media have speculated the tower could be sold to Chinese investors and turned into a bank centre.

There was no reference to such a plan, however, during this week's visit to Caracas by Chinese president Xi Jinping.

AFP