The Government announced on Tuesday that a $1b Housing Infrastructure Fund would be allocated across nine projects in five different council areas: Auckland, Hamilton, Waikato, Tauranga and Queenstown.
Territorial authorities that were in, or part of, a high-growth urban area from December last year were invited to apply, but the Wellington region came just short of the qualifying mark.
The criteria defined "high growth" using Statistics New Zealand medium urban area population projections. One of the stipulations was population growth of more than 10 per cent between 2013 and 2023.
According to the most recent data, Wellington region's population was 486,700 in 2013 and projected to rise to 532,500 by 2023, giving it a growth figure of 9.4 per cent.
Anna Lillis, spokeswoman for Finance Minister Steven Joyce, said the fund was a one-off for the councils that met the criteria at the time it was set up.
However, the Government was working on plans for other mechanisms to help councils attract outside capital to assist with infrastructure development. Wellington would have the option of being part of any solution, she said.
Acting Wellington Mayor Paul Eagle said it was disappointing the region had not met the threshold and, despite the figures, he considered the city to be a high-growth area.
He welcomed future Government plans, but worried the capital could be snubbed when other councils came knocking on the Government door for housing help.
"We don't want to be forgotten."
Wellington's inability to build houses quickly enough to keep pace with its population growth has left it 3590 dwellings short of what it needs.
The result was multiple tenants packing into rooms, and a rise in homelessness, Eagle said.
The recent recommendations of the Mayor's Housing Taskforce highlighted the desperate need for the capital to build more houses.
"The taskforce findings clearly identifies we need homes," Eagle said. "We will ask the Government to partner with us on further proposal we put in front of them."
Taskforce solutions included signing a new partnership agreement with the Government as well as increasing building heights, allowing more site coverage and stepping up council-led development.
"It's clear we need a Government partnership, and it's our expectation that there has to be a sit-down."
Using Strathmore as an example, Eagle said the council could create a masterplan and then ask the Government for help to develop it.
The council had proved to have a reputation for delivering, and had a good a track record with Government partnerships after signing the $400m, 20-year partnership with the Crown in 2008 for a housing upgrade programme, he said.
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