Labour's housing package: ACT, Judith Collins tear down Jacinda Ardern over rent increase fears

ACT says "you can't pay your rent with Jacinda's spin" after the Prime Minister's PR plans to tackle criticism of Labour's housing policies were exposed in an email inadvertently sent to Stuff.

The package announced last week set off a political firestorm with renters, prospective first-home buyers, economists, welfare advocates, students, property investors and landlords all weighing in on whether it would drive up rental prices.

The Monday morning email from Ardern's chief press secretary Andrew Campbell asked for evidence "our rent increases have been in line with increases under National" and tasked staff with seeking quotes from economists to help in "arguing against the assumption rents will go up".

This showed the Government is "concerned about the perception that its new housing policy will raise rents", Stuff senior political reporter Thomas Coughlan wrote.

The ACT Party's housing spokesperson Brooke van Velden has seized the issue by warning this is exactly what will happen.

"No wonder the Prime Minister's spin doctors have been hunting out quotes from economists who might disagree with many of their colleagues that renters will suffer as a result of scrapping mortgage interest deductibility," van Velden says in a statement.

"As Victoria University political scientist Dr Bryce Edwards put it in his weekly roundup of politics today 'Renters have been thrown under the bus by the Labour Government'.

"As sure as night follows day landlords will seek to offset thousands of dollars annually in extra tax bills by increasing rents."

National leader Judith Collins followed this with a release of her own, arguing "renters have been thrown under the bus by this Labour Government".

"Jacinda Ardern has unleashed a raft of changes on rental properties: two extensions to the bright-line test, banning letting fees, and major amendments to the Residential Tenancies Act. All the way through, officials told her that rents would increase but her Government maintained a view that the officials were wrong," Collins said.

"As was the case with its changes to rental standards last term, Labour has failed to grasp that forcing more costs onto landlords will ultimately reduce the number of rentals on the market, making renting more unaffordable and exacerbating homelessness.

"This policy-on-the-fly approach is eroding the confidence of property investors and, ultimately, discouraging them from building more houses, which is exactly what needs to happen to solve New Zealand's housing shortage."

Ardern addressed the subject on Monday afternoon after she was questioned if the Government would consider capping rent increases - something Finance Minister Grant Robertson failed to rule out in his Saturday Newshub Nation interview.

"We've got no further plans at this stage around the areas of rent, I've seen a lot of speculation around what our housing package may mean for rents, but again it is speculation and so at this stage no further plans," Ardern replied.

Ardern was asked what would happen if the Government did see rents rise, and dismissed this as a "hypothetical" at this stage.

"We saw increases in house prices, we then responded to that, but at this stage it is speculative," she said.

"What we've seen in our rental market has not mirrored what we've seen with house price growth. In fact, more often than not, it's tended to mirror wage growth and so we will keep an eye on the numbers closely. But at this stage, we have no further plans in that area."