The houses were initially used as a part of HNZ's community group housing scheme. The house was one of 16 rental homes in the Bay of Plenty used by government-funded groups that provide residential community services.
Mr Horan said the idea of vacant property was "pretty alarming" when there was a high number of homeless people in Tauranga.
"There is clearly a urgent need, especially when you have a family camping by a river.
"How could they (HNZ) let that happen - it has been vacant since April - when we have an estate that is available?"
He also questioned why HNZ was currently selling the property.
"It defies belief when they have somewhere that would house so many people and they have done nothing about it."
The property was put up for sale in December 2013 after the community group decided it was no longer required.
"We have just had an offer from an organisation wanting to purchase it and we're currently working through that process with them.
"However, the size and configuration of the property mean it's best suited to a community organisation or group rather than an individual family, so it isn't the kind of property we would have available for families on our waiting list," he said.
By the numbers
*There were 87 families waiting for homes in Tauranga on February 10.
*Housing New Zealand has 1353 properties in the Western Bay.
- Housing New Zealand
