The school is building two four-bedroom homes to accommodate them.
Board of trustees chairman Andrew Howard said the high cost of buying or renting a house in Wanaka had contributed to a huge drop in the number of applicants applying for teaching positions at the school.
''We definitely struggle to attract the right teachers here,'' he said.
''Teachers are paid the same whether you are in Auckland or Tahuna, and Wanaka is probably the least affordable market in the country.
''We have had teachers who have accepted a job and then decided not to come when they find out how much it costs to buy or rent, and we know that is only going to get worse.''
Mr Howard said providing affordable accommodation to new teachers would help them get established in Wanaka and eventually move into their own home, or other rented accommodation.
Wanaka Primary School owns a Roche St house attached to the old school, but it has not been fit for purpose for over a year.
Mr Howard said it would shortly be demolished, and construction of the first new home would start. There were plans to build a second house on the same section in the future.
Wanaka principal Wendy Bamford said she was excited about the project and praised the board of trustees for being ''future focused'' in addressing the main issue in attracting staff.
''I used to advertise a teaching job four years ago and I would get 120 applicants, and of those, a high percentage would be quality applicants,'' she said.
''Now, I'm lucky if I get 10 applicants, and a lot of them are from overseas.''
Mr Howard said the board was able to fund the house independently of the Ministry of Education due to many years of good financial management, fundraising and support from families with children at the school.
''It is a very, very significant commitment. There has been a lot of discussion around return of investment, but the board of trustees saw attracting good quality teachers as the No 1 priority.''
Mr Howard said he hoped the first of the new homes would be finished in time for the start of the school year. The school already had staff lining up to move into the house when it was finished.
