"The new homes are part of HNZC's $3 billion capital investment programme across the country to improve the quality of its housing and to better match its tenants' needs in terms of location and size.
"We've got too many three-bedroom houses and not enough twos and fours."
At the end of March there were 160 families waiting for a spot in one of the 1600 Housing New Zealand homes in Tauranga. Housing New Zealand had also bought 12 other properties in Tauranga in the last 12 months - one five-bedroom house, two four-bedroom houses and nine two-bedroom houses.
Ensuring houses were insulated and warm was also a focus, Mr Smith said. Nationwide 40,000 of Housing New Zealand's 69,000 houses had been insulated, including 800 in Tauranga.
Tauranga Women's Refuge manager Angela Warren-Clark agreed there was a "huge need" for housing in Tauranga.
"Poverty is such a huge issue in the city and domestic violence is such a huge issue so they are often in tandem," she said.
The refuge was constantly having to turn down calls asking if it could temporarily house families struggling to find a home, she said. She was hopeful a review of the eligibility of those currently in state houses would free up more homes for those most in need.