Deputy Prime Minister Grant Robertson says successive Governments are partly to blame for New Zealand's housing crisis as data shows average house price growth is finally starting to slow.
The latest QV figures have revealed the market's month-on-month growth has slowed for the first time since July last year - this time by 0.1 percent.
But prices are still well up compared to 2020 and Finance Minister Roberston says New Zealand is still facing the aftermath of a perfect storm.
Earlier this year, the Government introduced a suite of new housing measures aimed at tilting the market away from investors and towards first-home buyers.
"We took this action. We always knew it would take a little bit of time to flow through but we are now starting to see the trend going in what I consider to be the right direction," Robertson told The AM Show on Tuesday.
"It is going to take a while given the momentum that's been in the housing market."
He said successive Governments hadn't built enough houses in New Zealand in the past 10 to 15 years - a period where both Labour and National have been at the helm.
"At the same time, our population grew well beyond the expectations that people had.
"We didn't plan properly as a country for this. What I can do is be responsible for what happens now and that is that we are building houses as a Government at a faster rate than any Government since the 1970s.
"We've taken these measures on the other side - on the demand side of the equation - such as banning foreign buyers from buying into that existing market, and the tax changes that we made most recently.
"I think you are starting to see the impact of that. This will take a considerable time to turn around because we didn't do that building over the last decade or so."
In the three months to May, values on average increased by 8.8 percent - compared with 8.9 percent in the three months prior to April, the latest QV data shows.
"We can expect to see further reductions in the rate of growth as the impacts of the recent tax changes for investors and credit availability start to take effect," QV general manager David Nagel said.
There was also evidence investors were pulling out of the market, according to QV property consultant Derek Turnwald.
