Real estate agents say the Government's tax changes are having a "huge" impact on investors, with all regions slowing down after the March announcement.
To try and help first home buyers get a foot in the door the Government cracked down on property investors by increasing the bright-line test from five to 10 years and removing the ability for investors to offset their interest expenses against their rental income.
Real estate agents surveyed by independent economist Tony Alexander, in conjunction with the Real Estate Institute of New Zealand (REINZ), said the changes have made a significant difference to investors.
In Auckland "some" investors are still buying property but in much smaller numbers.
"Investors are on pause," one estate agent told Alexander.
"I get the feeling when our listings dry up over winter and the price squeeze goes on, investors will realise prices are not falling and will buy back in again."
It's a similar story in Canterbury with a "huge decrease" in investors following the Government announcement - but numbers are starting to creep back up.
"There are many opportunities that investors are interested in while some have had to defer their next investment and reduce debt to handle the tax changes."
In Wellington, investors are getting rid of stock but enquiries from purchasers are "well down" front the previous six months.
In March investors and speculators who already own multiple properties made up the biggest share of buyers in the market - more than 40 percent - and the share of homes being sold to first-time buyers was shrinking, as the deposits required to get lending get further out of reach.
The new housing package aims to increase the supply of houses and remove incentives for speculators, to deliver a more "sustainable" housing market.
"The housing crisis is a problem decades in the making that will take time to turn around, but these measures will make a difference," Prime Minister Jacinda Ardern said.
"There is no silver bullet, but combined, all of these measures will start to make a difference."