Housing New Zealand is selling off state houses in Christchurch partly because it is increasingly focused on Auckland's housing shortage, Bill English says.
English, the minister responsible for Housing New Zealand, made the comment after announcing up to 2500 state houses in Christchurch would be sold to community housing organisations.
The Government was increasingly looking to diversify ownership of social housing, he said.
But he also said the Government wanted to offload some the properties in the city because Housing New Zealand was "strongly focused" on Auckland, where the need for housing is greatest.
English maintained that Government still had a role to play in social housing in Christchurch. Housing NZ would continue to own and manage another 3900 state houses, mostly in Christchurch's south and east.
But the government "had not done a good job" of looking after its housing stock, he said.
"Taxpayers own one in every 16 houses in New Zealand, and when you drive around you can tell which ones are ours."
English's comments prompted a strong response from Labour leader Andrew Little, who said the minister was using "weasel words".
Little said it was "complete bollocks" to be selling off state houses at a time when an estimated 41,000 people were homeless.
He insisted that HNZ was still the best organisation to be housing tenants on the social housing register.
The Government's plan to sell 8000 state houses to charities, churches and iwi over three years has hit several hurdles this year. Proposed sales of hundreds of HNZ homes in Invercargill and Horowhenua have fallen through.
English was more optimistic of finding buyers in Christchurch, saying "a number of consortia" were already lining up for the properties including the Christchurch City Council's housing trust.
Any successful bidders for the state houses will not be able to resell them unless the Government agrees. They will sign 25-year deals with Ministry of Social Development to provide social housing.
English assured Housing New Zealand tenants there would be no change for them.
"This doesn't change what they pay for the rent and it doesn't change the security of their tenancy."
As part of National's social housing reforms, housing organisations can access income-related rent subsidies, which allow providers to cap rent at 25 per cent of the tenant's income.
Social Housing Minister Paula Bennett said one of the Government's bottom lines was that tenants' rights would remain the same and that they would be housed as long as they needed to be.
KEY'S OLD HOME ON THE BLOCK
The state house in which Prime Minister John Key grew up in is among the HNZ properties being sold.
Key lived at 19 Hollyford Ave in Burnside with his mother Ruth from age seven. The three-bedroom, 1950s villa is now valued at $325,000.
Key said he had fond memories of the house.
"It served us incredibly well as a family," he said today. "And I'm very confident it will serve other families very well as well.
"The big issue here is that just because Housing New Zealand doesn't own it doesn't mean if won't be providing families in need with support.
"It will, but it will just be going to a community housing provider."
The Housing New Zealand properties slated for sale are mostly in Bryndwyr, Riccarton and Shirley.