Judith Collins has suggested National and Labour fix the housing crisis "together" by passing similar laws that allowed fast-tracked building following the Canterbury earthquakes.
At her State of the Nation speech in Auckland on Tuesday, Collins said the time had come for an "extraordinary" solution to an unfolding "emergency" as house prices and rents continue to increase across New Zealand.
"New Zealanders have had enough. It's time for the two major political parties to work together to fix this problem," Collins said.
Collins is proposing a law change that would give the Government power to rezone council land, making room for 30 years' worth of growth in housing supply, both through intensification - or focusing on compact urban growth - and building on land that has never been used, referred to as greenfield development.
"The appeals process would be suspended so district plans could be completed as quickly as possible," Collins said. "Requirements for infrastructure to be built prior to zoning would also be suspended."
She said it would be a nationwide equivalent of the emergency powers put in place to get houses built in Christchurch following the 2010 and 2011 Canterbury earthquakes.
The quakes resulted in devastating destruction with around 100,000 homes damaged and 10,000 deemed unsaveable, former Earthquake Recovery Minister Gerry Brownlee said at the time.
The then-National-led Government passed laws that gave the Crown extraordinary powers to govern the region's recovery, aiming to increase the efficiency of the rebuild.
Brownlee, in his new role as Earthquake Recovery Minister, was able to make changes to the Resource Management Act (RMA). He could approve residents in some Christchurch suburbs to rebuild homes without needing to seek resource consents.
Those powers have since been removed - but Collins wants to see something similar put in place to help boost building consents across the country.
Collins has written to Prime Minister Jacinda Ardern suggesting that a special parliamentary committee be established immediately to develop the emergency legislation, with recommendations available for consideration by the end of March.
The Government has already allowed some fast-tracked infrastructure that bypasses the RMA to help stimulate the economy in the wake of COVID-19. The approvals process instead goes to expert panels that set the conditions for approval.
The Greens voted against it over concerns that it reduces public participation and narrows environmental considerations. The law has a 'sunset clause', meaning it will be repealed two years from enactment.
National's housing spokesperson Nicola Willis said the Government's latest announcement of where the additional 8000 public and transitional houses announced in Budget 2020 will be built is not enough to fix the ballooning housing issue.
"National wants more for New Zealanders. We don't want a future where the only answer to being able to afford a place to live is to get on a Government housing waiting list."
The Government has built 4759 state homes since Labour was elected at the end of 2017, and there are plans to build an additional 8000 state and transitional homes, bringing the total to 18,000 by 2024.
But even with 18,000 state and transitional houses, that would still leave more than 4000 people needing somewhere to live, going by the current waiting list.
Meanwhile, national house prices are forecast to leap 15 percent this year - that's on top of last year's massive 11 percent growth.
Last week the Prime Minister laid out the Government's timeline to address the housing crisis. It includes reforming the RMA, housing supply measures in the upcoming Budget, and councils being forced to free up more land for housing under the new National Policy Statement on Urban Development.
Ardern said housing is one of New Zealand's "toughest long-term problems" and that the current rate of housing price growth is "unsustainable", with first-home buyers shut out.
"There is no silver bullet for fixing the housing crisis but that is not a reason for inaction. It's a reason to tackle this issue on multiple fronts and on an ongoing basis," she said. "It will continue to take a concerted effort across the term."
Finance Minister Grant Robertson is currently considering advice from Treasury and the Reserve Bank on demand-side initiatives, and he expects to make announcements in late February.
Ardern said the Government's actions will "aim to tilt the balance toward first-home buyers and aim to take some heat" out of the market.