An Auckland iwi, building homes for its people, says Government rules could prevent it from getting rent subsidies because the tenants are tribal members.
Ngati Whatua o Orakei will begin building 30 houses in August, and has the capacity over time to build houses for up to 3000 people.
The iwi is working with the Crown and the Ministry for Business, Innovation and Employment to become a social housing provider.
But an iwi trustee Ngarimu Blair said it was not looking too attractive. He said the iwi could not positively discriminate, which meant it would not get income-related rent subsidies if the homes were only for its descendants.
He said the houses would have to be opened up to everyone. Mr Blair said it was a problem for IHC and the Salvation Army pursuing their own housing developments too.