Trust House boss Allan Pollard said Trust House would borrow $15m to $17m for the plan that could solve the housing crisis in the region.
He is disappointed nothing has happened over “months and months” of talks and that the Government is looking at “lining the pockets of property developers” by doing deals with them.
Labour MP Kieran McAnulty said Trust House wanted government money to increase its asset base and the Government was not going to “subsidise ownership”.
But Pollard said Trust House is community-owned so it would be the community that would own the houses if the Trust House plan went ahead.
In August last year it was announced that 80 new public housing places would be built in the area covered by the Wairarapa electorate by 2022, including 50 in Masterton.
McAnulty said there were many ways to skin a cat and the Government was looking at a range of options, including Housing New Zealand building them itself.
“Just because it is Trust House’s idea doesn’t mean it is the only game in town,” he said.
“We need to look at doing it in the most cost-effective and quickest way possible,” he said.
He said one scenario was for a developer to build the homes and continue to own them, with the provision of social housing for 25 years.
“Why wouldn’t you explore it?”
McAnulty said the main point was that the Government had guaranteed there would be 80 new public housing places in the Wairarapa electorate area.
Trust House purchased 541 state houses in the region for $10.5 million in 1999 and is a registered community housing provider.
It has 485 rental homes in Masterton, Martinborough, Featherston, Pahiatua and Dannevirke.
McAnulty said he was working hard to get the houses built but the talks about specific deals were at the ministry level.
Masterton Mayor Lyn Patterson has also been working hard behind the scenes as an advocate but the council won’t be building them.
She said the urgent need for more social housing had been identified by the Government in the public housing plan that was delivered in August last year.
“I don’t care who builds them as long as we get them. My understanding is there are developers looking to do this in partnership with the Crown and with a community housing provider.”
She is hopeful some of the new houses will be built within the next few years.
“We are lucky we have been allocated the houses. The Government has recognised there is a need here.”
Housing Minister Phil Twyford told the Times-Age discussions were under way “right now” about how to build the homes.
“There is nothing to stop Housing NZ building houses in Wairarapa and we are keen to find ways to work with Trust House as well.
“Trust House is a really positive local organisation,” he said.
“We are also looking at how we can work better with councils,” Twyford said.
McAnulty used to be on the boards of Trust House Ltd and Masterton Community Trust.
“I know Allan very well and we have had many discussions about this. I don’t consider this tension at all. I just think there is difference of opinion about how to go about it.”
He said there would be community outrage if the Government subsidised the asset.