Community housing providers say they are shovel ready to help the Government build the 8000 new public houses promised in today's Budget, but also warned this was only half of what was needed.

The planned 8000 new state-owned houses would more than double the current programme to build 6400 homes for residential and transitional housing for homeless people.

The move was also expected to bring greater certainty to construction companies planning a path through the expected Covid-19 recession.

The Government said its Kāinga Ora agency would build 6000 homes, and non-profit community and transitional housing providers would build the other 2000.

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Community Housing Aotearoa chief executive Scott Figenshow said a quick poll of just 12 of the 57 organisations registered as community housing providers showed they had 63 housing developments ready to go in 13 regions across the country.

These totalled 2638 homes with a total development cost of $783 million. The only catch would be to ensure the Government's new funding was made available in a way that worked with the projects.

"So we have capability and ready-to-go projects that we can activate across the country," Figenshow said.

"We just want to make sure that the funding will work to activate many of those projects."

Yet while community housing providers were thrilled to step up and help build the homes, they warned many more were needed.

Figenshow said the 8000 new homes was about only half of the 14,869 people who had registered on the public housing waiting list by the end of last year.

"We've been calling for 15,000 additional social housing places since 2014. If we had those places now, that would go some way to reducing the misery of homelessness that we are continuing to see," Figenshow said.

"What's needed is a permanent housing investment fund of $2.5 billion over 10 years to allow community housing providers to work with iwi, churches, philanthropic investors and communities to turn land into neighbourhoods where people can thrive."

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Peter Jeffries, the chief executive of CORT Community Housing, said his team was ready to go and added that the news would be a boost for builders.

"The uncertainty and the talk of recession always hits the construction industry quite heavily so this would be excellent news for them as it would certainly provide more work and jobs," he said.

Figenshow added that community housing providers had about $50 million in planned upgrades to existing houses scheduled over the next five years but that this could be brought forward to support immediate jobs if Government funding was made available.

Kāinga Ora said it would finance its proportion of the additional 8000 places by increasing its borrowing over the next four to five years, anticipated to be about $5 billion.

Budget 2020 also diverted $570m from the Income Related Rent Subsidy funding to support the programme.

The new houses were expected to take four or five years to complete and would raise to about 17,000 the number of state houses on the Government's construction schedule.

"This multi-year investment sends a strong signal to the construction sector so it can plan with certainty to secure investment, retain staff and further enhance the skills of its workforce," Housing Minister Megan Woods said.

"The economic impact of more than $5 billion of construction activity will be significant."

The Government also announced a $56m boost to funding for insulation and heating to be fitted into about 9000 homes.

Bindi Norwell, chief executive at Real Estate Institute, welcomed the announcement.

"The biggest problem with insulating older homes, has always been people's ability to pay outright for the insulation even if a subsidy has been in place. This has been particularly difficult for lower-incomes families," she said.

"Today's announcement increases the grant available from 67 per cent to 90 per cent, which will go a long way to ensuring that people have a warmer home this winter."