About 750 units of social and affordable homes will be built in Wellington to avoid an Auckland-style housing crisis.
The project is the next phase of Wellington City Council's 20-year housing upgrade programme, which started in 2008.
Many of the homes will be built within three years, including completion of 105 social housing units currently under construction at the Arlington site 2, at the top of Taranaki St, which is costing $33m.
Arlington site 1, on the Hopper St side would likely be the next project. It will include a mix of social and affordable housing on one site.
Other sites will be mostly on existing council housing land in the CBD and beyond.
Wellington Deputy Mayor and housing portfolio leader Paul Eagle said the council would now be proactively working with partners to develop new sites and build new affordable homes.
It will not impact rates because city housing did not receive any rates funding - operations were funded by rental income.
"I assure ratepayers that we are not spending anymore money than the $200 million funding we have left from the crown and council partnership."
In 2008, the council started on a joint 20-year project with the Crown to upgrade the council's social housing, most of which was built in the 1960s and 1970s.
"We'll be making some movements in our portfolio where we have properties that are outdated or not suited to our tenant's needs, in order to reinvest in new high quality homes," Eagle said.
"The end result will be more social housing units for those in need."
Wellington Mayor Justin Lester said the mixed developments would have "good quality" houses.
"This is a major development in how our city handles housing. We know we need a new approach to social and affordable housing so that we don't end up like Auckland."
Some would be social housing, while others would be affordable homes aimed at first home buyers.
Affordable housing meant the sale cost will be below the median house price for Wellington, which is currently $530,175.
"We aren't just going to sit on the sidelines and leave social and affordable housing to the market. We're going to roll up our sleeves, work with developers, and get the job done," Lester said.
The houses would be the first in a number of developments to address housing issues in Wellington.
The plan will use existing resources and will be paid for through the disposal of some sites and selling under-performing housing stock.
The council would be working with the private sector, community housing providers and a new urban development authority.
Next week Lester will ask councillors to agree to a new programme that will see it utilise council land better to develop quality new homes as fast as they could.
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