The Government has stepped in to help manage the Western Bay's burgeoning population with plans to fast-track affordable housing projects.
Tauranga and the Western Bay of Plenty were yesterday added to a list of areas that come under the Housing Accords and Special Housing Areas Act.
The new legislation, which was passed in September, aimed to free up land for housing and make it affordable.
The Accord was running in Auckland where it aimed to ramp up the city's new build rate from the average of 3600 a year to 17,000 in 2016.
Housing Minister Dr Nick Smith said New Zealand's housing supply and affordability challenges extended beyond Auckland and the Government wanted more houses built.
"The major housing challenge in Tauranga and the Western Bay is managing projected population growth of 64,000 people over the next 20 years," he said.
"This will require an additional 1300 homes per year but only 800 per year have been built over the past five years, contributing to high house price inflation.
"The Government and councils favour a coordinated approach across both districts to address supply and affordability."
Dr Smith said the Government would not automatically replicate the Auckland Accord's focus on fast-tracking housing developments. "We want to get officials from Government and council working on identifying the barriers to supply and affordability of housing and then putting in place whatever steps are needed to make improvements, Dr Smith said.
Bay developers welcomed the move but at a council meeting yesterday, Mayor Stuart Crosby expressed concern it allowed the Government to work "outside the current city plan".
"The Government of the day can say there is going to be 5000 houses there, or 2000 homes over there, whether you like it or not and you (council) will be paying for it," Mayor Crosby said.
"Initially, we were not on the schedule, it was only Auckland and the Minister had said Tauranga was not a priority.
"There may be an upside to it, however, it does entail partnership with the Government."
Former National MP and landlord Bob Clarkson, who had been pushing to develop about 200ha of his land near Tauriko, said he was excited by the plan and would be "racing" to sign up and offer "affordable, nice housing".
"It is about time someone came in and showed the council how things could be done," he said.
"It is not right that young people cannot buy an affordable home when all it would take is a couple of hundred extra properties every year.
"I have invested around $54 million down here and it has been going nowhere because council would not support it, well not anymore.
"If I have my way I will build a factory on my land and start popping out affordable homes for everyone.
"It is only fair that young people get a chance to get on the property ladder.
"Who cares about going outside of the city plan, if you have a good idea it should be acted on, especially when you have an affordable housing shortage like we do here."