The Government says 536 jobs have been created by a programme to upgrade state houses.
More than 18,000 houses are to be upgraded by July 2010.
Housing Minister Phil Heatley says the $104.5 million programme will make the houses warmer, drier and healthier.
On Monday he visited a state house in Porirua which is to receive bathroom renovations, new carpet, a heat pump, off-street parking and fencing.
Mr Heatley described the condition of some state houses as shameful.
"One of the big things with our changes in the Residential Tenancy Act making sure that the private landlords are providing houses that are up to scratch - it's disgraceful that the state is providing housing like this."
More than 600 state houses have already been upgraded or have work underway.
Housing New Zealand has 65,000 houses.