The Government has already spent more than $8 million buying back homes no one wanted from developers, and there are 40 homes which have been on the market for more than six months.
National's housing spokesperson Judith Collins said it's safe to assume there's something "seriously wrong" if you can't sell a house within six months.
"Often it's the price or the location, or it's just not the configuration that people want. I'd say in this case, it's probably all three," she told Newshub.
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The Government has embarked on a KiwiBuild buyback of sorts, with 17 homes bought back from developers for around $8.1 million.
Six of the homes the Government bought back from developers have been on-sold to eligible Kiwibuild buyers.
Collins said it is "pretty bad, particularly when you consider that they've also got contracts for more houses to be built in places like Wanaka and Te Kauwhata where they haven't been able to sell houses".
The Government pumped $2 billion over 10 years into a recyclable fund to keep building KiwiBuild houses with the money gained from selling them. Each dollar spent was supposed to be recouped to spend on the next house.
But new figures obtained by Newshub show that so far, $98.4 million has been spent from the fund, and just $2.7 million of that has come back to the Government.
"The Government can't afford to keep building KiwiBuild houses if they're not recycling the money," Collins said.
Newshub approached Housing Minister Megan Woods for an interview, but she said she won't be commenting until the KiwiBuild reset is announced at 1pm on Wednesday.
A statement from her office said the minister has always acknowledged that KiwiBuild hasn't worked the way it had been anticipated.
They said the roughly $98 million that has been spent so far includes large land purchases like Wakatipu High School in Queenstown that will be used for longer-term housing developments, so it will take longer to get that back into the recyclable $2b fund.