A word of caution as Wellington City Council goes full steam ahead with its new housing plan.

Yesterday councillors pushed through a Draft City Housing Strategic Investment paper, which includes the move to build 750 social and affordable homes.

Deputy Mayor Paul Eagle says the move means going beyond simply upgrading existing properties.

"We know we can do better and that's what the staff have done here - they've gone away and said, 'The land these homes sit on, we can do something better with'."

Paul Eagle's paper was met with much support, but Councillor Iona Pannett warned they will need to keep an eye on the budget.

"We do need to be a bit cautious - if we're suddenly saying that we can afford to do some things we previously thought we couldn't it does sound a little magical."