Hundreds of state houses are to be sold this year as part of the government’s controversial social housing reform programme.

Around 1124 state houses in Tauranga and 348 state houses in Invercargill have been offered up for sale to Community Housing Providers (CHPs).

Housing New Zealand Minister Bill English said the government has now requested formal proposals from four of the CHPs who have officially expressed interest in buying the state houses and then managing them as social housing.

Accessible Properties, Hapori Connect Tauranga and Kainga Community Housing Partners have been shortlisted in Tauranga.

The Pact Group has been shortlisted in Invercargill.

English said the shortlisted organisations had submitted high-quality expressions of interest.

While sales can only be made to CHPs, there is scope for private investors to get involved in the provision of social housing.

It would be possible if a private investor was to become a registered CHP themselves or if they partnered with a registered CHP.

A number of existing CHPs have previously indicated they would consider partnering with commercial entities to achieve better social housing results.

Social Housing Minister Paula Bennett said the government expected the social housing sector to work with financiers and asset managers.

“This is to share expertise and figure out innovative new ways of providing housing for our most vulnerable. Those on the shortlist have been thinking creatively and seriously about how to do this.”

The shortlisted organisations now have to go through the next stage of the official purchase process. This closes on 30 May for Invercargill and 7 June for Tauranga.

The government plans to announce the preferred buyer in each region in the third quarter of 2016.