A Tauranga City Council committee has voted to progress a plan to sell council-owned pensioner villages to a community housing provider.
It was the recommended option put to councillors in this afternoon's community and culture committee meeting, who voted unanimously to support it.
The next steps will be for the full council to consider the proposal, which, if supported, would go out for public consultation early next year with the Long Term Plan for 2018-28.
In the meeting, councillors emphasised that tenant welfare was their primary concern in making the decision.
The decision was in line with the findings of an independent review that came out in August.
After receiving the review's findings, on August 8 the committee asked council staff to investigate selling its portfolio to a community housing provider or retaining the land and assets and leasing them to a provider.
Keeping the status quo - council owned, council run housing - was also an option.
Staff argued that not-for-profit organisations and community housing providers can provide better "wraparound" services and give new tenants access to rent subsidies that people living in council-owned housing cannot get.
The council has 246 elder housing units spread across nine villages in Greerton, Mount Maunganui and central Tauranga.
Four of the older villages were expected to have to be replaced within the next 20 years.