The value of houses needs to drop by 55 percent or Kiwis need a 120 percent pay rise for current house prices to be 'affordable', according to analysis.
But the Government refuses to admit it. It won't set a target for housing affordability outcomes from its major market intervention.
"The escalation in house prices we've seen has really been unsustainable for everyone," Prime Minister Jacinda Ardern said on Thursday during a visit to Hamilton and her hometown of Morrinsville.
During a visit to her old intermediate school, Ardern gushed over a wooden cop car crafted for her policeman dad Ross Ardern, with his initials ingrained and the year '92.
"I made this!" she said.
That year, 1992, was also a time of peak homeownership in New Zealand, the very last time house prices were three times incomes - the measure of affordability.
Since then, house prices have continued to increase.
There is an international measure of housing affordability called the median multiple - the ratio comparing the median house price to the median household income.
The dream is a median multiple of thee - affordable - house prices three times incomes.
Three to four is classed as moderately unaffordable while four to five is seriously unaffordable, and anything above that is severely unaffordable.
New Zealand's rating is off the scale - 6.7, that's countrywide. It's even higher in our big cities.
But the Government won't set a target to lower it.
"There are so many factors that come into that," Housing Minister Megan Woods told Newshub when asked why the Government won't set a target on affordability.
One factor: House prices might need to fall, which is politically taboo.
"Are politicians willing to see house prices go down?" asks Infometrics economist Brad Olsen. "Because as much as we'd love to see incomes go up, they're just simply not going to go up fast enough to change this housing crisis."
Ardern says it's "not about being brave" to say house prices need to fall.
No, it's about being realistic.
Infometrics analysis shows to get us back from severely to just seriously unaffordable, house prices either need to fall by 25 percent or incomes need to rise by 34 percent.
And if we wanted to shoot for the stars - actually affordable housing - house prices need to drop by 55 percent or we need whopping pay rises of 123 percent - our pay more than doubling.
It might happen - pigs might fly - but there's another way.
"We need to stop treating housing as this solid gold un-impenetrable investment that never goes anywhere but up," says Olsen.
Finance Minister Grant Robertson said on Thursday the housing changes the Government announced earlier this week will put some "downward pressure" on house prices.
But when asked if that means house prices will fall, Robertson said "no".
That leaves those monster pay increases then.
There's another thing holding the Government back from setting an affordability target: the KiwiBuild fiasco - the Government's ultimate failed target.
It's made them scared of accountability measures and thresholds.
