The Government's state housing agency is set to run out of money by February, ministers have been warned.
Housing New Zealand has also told Finance Minister Bill English that it will have no cash for developments or to maintain houses past 2017/18.
An email by a Treasury official appeared to say that the corporation would run out of money by early next year.
"HNZC modelling indicates that it is likely to exhaust its cash balance by February 2017 based on its planned development activity."
HNZ's financial situation was partly the result of the transfer of 2800 state houses to the Tamaki Regeneration Company, a Government-council entity, this year.
The transfer meant $1.6 billion was removed from HNZ's balance sheet and it was now collecting $34m less in rent a year.
Housing New Zealand is a core government agency responsible for a key government service. Running it to the brink of bankruptcy like this shows either utter incompetence, or pure malice. Either way, there's a real danger that National will use this self-imposed crisis to further undermine state housing by privatising more of it or reintroducing market rents. And when we have a real housing crisis on our hands, either would be a disaster.