Tauranga's population has grown by the size of Te Puke in two years and the flood of people is expected to continue.

Data analysts confirmed that the influx had contributed to an economic boom while creating challenges with traffic jams and soaring house prices.

The latest estimates from Statistics NZ and Infometrics showed Tauranga's population grew to 124,600 by the end of last year, up from 116,190 in 2013.

That was an increase of 8410 - more than the entire population of Te Puke, which was just under 7500 at the 2013 census.

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Tauranga's influx includes a significant number of foreign immigrants. A report from economic research company Infometrics showed that Tauranga had "a permanent and long-term net migration" of 1188 people from overseas in the year to September. This reversed a trend for the past decade, during which international migration saw the city lose more people than it gained.

Read more: Tauranga lifestyle a drawcard

City leaders said there were plenty of positives in the growth but acknowledged that it posed challenges for housing and infrastructure.

Tauranga mayor Greg Brownless said people were coming to the city with fresh ideas, creating jobs and boosting the economy.

"That's good for everybody," Mr Brownless said.

The biggest problem was that population growth strained resources and infrastructure such as libraries, roads, wastewater and public transport.

"Infrastructure has to be paid for up-front, and ratepayers end up paying for it," Mr Brownless said. "On the positive side, there's more ratepayers."

Priority One strategic projects manager Greg Simmonds said Tauranga's growth spurt differed from previous ones in that there were plenty of jobs for the new arrivals. During the past year, 7900 jobs had been created.

Businesses were moving to Tauranga for reasons including access to the port, the price of industrial land and because "this is a place where people want to live".

Mr Simmonds said businesspeople had previously believed it was hard to recruit staff in Tauranga but that perception had changed.

The influx was straining resources in some unusual places.

Papamoa Surf Life Saving Club chairman Andrew Hitchfield said 40 to 50 new families had joined the club this season, each bringing two or three people. A clubroom designed for 200-odd people now had to deal with 850.

"It's just going crazy," Mr Hitchfield said. "It's going off."

One of the most noticeable results of the population boom was the rise in Tauranga's house prices. The latest figures showed a 24 per cent rise in the past year, although the rate of growth was slowing.

Statistics NZ estimated that Tauranga's population would crack 129,000 in 2018 - an increase of about 13,000 in five years.

Highlights

Tauranga's population has grown by 8410 in two years
It's expected to reach 129,200 by 2018
Tauranga's population grew 3.2 per cent in the year to June
In the year to September, 1188 people came to Tauranga from overseas
Tauranga's GDP is up 4.4 per cent in the year to September
Consents for residential building are up 46 per cent in the city