The government will build 145 new social housing units in Wellington by the end of next year, the Social Housing Minister says.
It comes just days after Social Housing Minister Amy Adams announced 330 new homes would be built in Lower Hutt.
But critics say it's too little too late for the city which is nearly 4000 homes short.
If all goes to plan, the first of these homes will be ready by this time next year.
Mrs Adams said the $48.5 million project has been years in the planning, and the one-bedroom units fit the demand in Wellington - which was mostly from single people and couples without children.
"These are intensified developments of apartments of one bedrooms for people with quite high needs and we have a real need for those, and bringing them together in purpose-built facilities where we can provide that wrap around support is really important.
"My core job is to make sure we have the social housing mix and quantity that we need for our tenants," she said.
The units would be warm, energy efficient, and have good access to sunlight.
The 20 units at Hanson Street in Mount Cook near the hospital would be designed specifically for people with disabilities.
Patrick Dougherty, Housing New Zealand's general manager of asset development, said the Hanson Street site would also include a communal space to help foster community.
"In this particular site, there are people where accessible housing is required, so clearly there are some mobility issues for the people that are going to occupy it.
"Having something close, on site for them to be able to congregate or just connect with people - because one bedroom units are not that large - is quite appropriate," he said.
But Labour has dubbed the announcement a cynical election ploy because the developments had already been announced, and one site has been vacant for five years.
Once the 145 new units are built, the city will have nearly 70 fewer units than in 2014.
At the same time, demand continues to rise - the waiting list in the city has grown from 121 people in June 2014, to 200 in March this year.
Deputy mayor Paul Eagle chaired the city's housing taskforce and was also standing for Labour in Rongotai.
"The biggest disappointment has been the length of time it's taken to make these decisions," he said.
"Some of the sites have sat empty now for quite some years and the community has been saying to me, 'look, what's happening? When are they going back in? What are they going to look like?'
"The waiting lists are getting longer, both for the city and the state, so it's important that any new stock gets given a tick but we need more," he said.
The Wellington City Council provides more than half of all the city's social housing.
Mr Eagle said there were about 4000 social houses in the city already, but another 4000 social houses would be needed over the next two decades.