The number of state houses in New Zealand has fallen by nearly 300 since the National-led Government was re-elected, but Housing New Zealand says it is focusing on location, not numbers.

Opposition MPs have suggested the Government has given up on state homes because demolitions and sales far exceed the number of new buys and new builds.

The Green Party pointed to Housing New Zealand's statement of intent, which projected that sales of state houses would exceed the value of new purchases.

Housing NZ said it was simply targeting the areas where the need for social housing was greatest. In 2009/10 and 2010/11, the Government increased its state housing stock by more than 500.


But in the year to last June there was a net decrease of 251 homes.

Green co-leader Metiria Turei was concerned because Housing NZ had sold twice as many homes as it had built in the past year. "When the Government decreases the number of state houses, it decreases the financial stability for families who are on the lowest income."

Housing NZ asset development general manager Sean Bignell said allegations of a "sell-off plan" were misleading.

The corporation was buying up more properties in high-demand areas and selling off homes in low-demand regions, he said.

Housing NZ had acquired 235 properties last year in expensive areas where it was difficult for low-income families to rent or get a foothold in the property market, Mr Bignell said.

Ms Turei said the Greens' policy was to build 3000 state houses in three years.