Other public housing tenants are being pushed to the fringes of the city, despite a cabinet submission recommending new stock be built within a kilometre of the light rail corridor.

Those are two of the findings in a searing report by ACT Auditor-General Dr Maxine Cooper, which pointed to problems with the way the territory's ambitious public housing renewal program was being rolled out.

The government must replace almost 1300 ageing public housing blocks by mid-2019 to cash in on asset recycling bonuses from the federal government.

While Dr Cooper commended the public housing taskforce on its interactions with tenants, she said its land evaluations were "overly optimistic".

Dr Cooper found the taskforce had a practice of adding 30 per cent to the property valuations to estimate sales revenue in business cases, based on advice from the Land Development Agency.

However she pointed out the total revenue from the sale of public housing had been less than predicted to date.

The exception was the March 2017 sale of the "Lyneham on Northbourne" development, although the estimates were based on a revised model in which 20 per cent was instead added to property value estimates.

"It would be prudent to rely on professional valuation advice and undertake a sensitivity analysis so that a range of estimates can be provided to decision‐makers, rather than adding a percentage to valuations. Providing a range of values would likely reinforce the challenging nature of making estimates," Dr Cooper noted.

Dr Cooper also questioned the decision to buy rather than build properties on territory-owned land, saying it came at a higher cost per dwelling.

In one example, the taskforce bought 11 townhouses in a complex of 17 and were forced to buy out the remaining six private owners after repeated complaints.

That was one of the problems Dr Cooper found with how the salt and pepper housing policy was being applied, but noted land constraints were largely to blame.

The audit referenced a June 2014 Cabinet submission, which recommended building public housing blocks of up to 25 homes "within 800 metres of the Capital Metro Corridor, in other areas in the inner north and in other areas of Canberra on existing HACT [Housing ACT], EDD [Economic Development Directorate] and community facility land".

However Dr Cooper found while 202 replacement homes would be built within 800 metres of the corridor, the bulk are expected to be located in new land developments in outer areas of Canberra.

More than 450 of the replacement homes will be in Gungahlin, 208 in Molonglo, 177 in the inner north, 137 in Tuggeranong, 101 in Belconnen and 15 in Weston Creek. The figures did not include proposed developments in Chapman, Mawson and Holder.

The suburbs of Coombs (150) and Moncrieff (140) will be where the largest number of public housing tenants will be moved.

Pushing the remaining 814 public housing properties onto the market to meet the July 2019 asset recycling deadline could see the ACT lose out on sale revenue, Dr Cooper said.

However Housing Minister Yvette Berry said sale prices weren't her highest priority.

"So far to date we are meeting the timeline to complete the renewal program and that program will be met based on a number of needs including the needs of our tenants. Of course the cost is an always an important part of it but investing in our community is an important part as well," Ms Berry said.

"This has been the biggest renewal program the ACT government has ever embarked on with 11 per cent of older unsuitable housing being replaced. We're on target to meet the deadline of 2019 with 697 residents in new homes already.

"The experience so far has shown we've exceed the expectations of government for the price of the land that's been sold already but the biggest challenge for us is getting homes built on time."