Foreign labour needed to achieve Kiwibuild targets - Little

Andrew Little has conceded Labour's Kiwibuild policy won't hit its 10,000 houses a year target in the party's first term.

Speaking to The AM Show on Monday, Mr Little also admitted the construction industry would likely have to import labour from overseas.

It's perhaps ironic, considering Labour has in the past said foreigners are contributing to the housing crisis.

Asked by host Duncan Garner if Labour would rely on foreign workers, Mr Little said: "Some of them may well come from overseas. That'll be part of it, but it's also about training up young New Zealanders."

As for the promised 10,000 extra houses a year under the party's Kiwibuild policy, Mr Little says 30,000 in the first three years isn't achievable.

"I don't have the precise figure for that first three years. It won't be 30,000 - it'll be closer to 20,000, because you're ramping up.

"Once you've had that kind of three-year ramp-up period, then you're going gangbusters."

A report prepared by ANZ and presented to the Treasury last year, and obtained by The AM Show under the Official Information Act, shows the bank believes New Zealand is short of 60,000 houses - with more than half of those needed in Auckland.

"It's not just a one-off - it's actually getting worse by the day," said Mr Little.

Prime Minister Bill English, also appearing on The AM Show, dismissed the report, calling it "a rough estimate by ANZ some time ago".

"Across the country we've got the largest construction pipeline we've ever had…and it's going to keep growing."

The pipeline still isn't meeting demand. Around 9000 houses were built in Auckland last year, well short of the 13,000 needed every year for the next three decades, as the Auckland Housing Accord calls for.

"You can't manufacture tens of thousands of houses out of fresh air," said Mr English.

Mr Little says the last time New Zealand had a major housing shortage was the 1930s, and building 10,000 a year then was no problem - with a quarter of the population.

The houses that are being built are also largely the wrong kind in Mr Little's view - large, standalone houses, when what the country needs is medium- and high-density apartments and terraced housing.