If you judged by house price growth alone you would think Auckland is the best performing region in New Zealand economically.
But not by a long chalk.
Plot growth in regions' gross domestic product per capita over the seven years to 2014 against the rate at which their median house prices increased and there is a reasonably good correlation. The conspicuous outlier is Auckland.
It recorded the strongest growth in house prices, nearly twice the national average, but is third from bottom of the class in per capita GDP growth over those seven years. Auckland outperformed only Hawkes Bay and Northland.
That matters, because ultimately there has to be a link between growth in output per person and growth in the incomes from which mortgages and rents are paid.
That disconnect in Auckland is one of the reasons brows furrow at the Reserve Bank when it looks at the city's housing market.
Governor Graeme Wheeler made clear on Thursday that the bank's concern with Auckland's double-digit and rising house price inflation is in its capacity as the guardian of financial stability, not (consumer) price stability.
It is not what is standing in the way of a cut in interest rates. At this stage the Reserve Bank is not seeing a repeat of the dynamic in the mid-2000s boom, where the wealth effect from rising house prices turbocharged consumption and stoked inflation as spending outstripped incomes.
It forecasts strong growth in private consumption over the year ahead, but sees that as underpinned by growth in employment and real incomes. It expects the household savings rate to remain modestly positive. Household deposits are growing at an annual rate of around 10 per cent.
The $675,000 median house price in Auckland last month was 14 per cent higher than a year ago, the Real Estate Institute reports. Its stratified index, which adjusts for variations in the mix of properties sold which can affect the median price, was 15.4 per cent higher, compared with 6.1 per cent nationwide.
The level of GDP per capita in Auckland, as opposed to its growth rate, is not much above the New Zealand average, Wheeler says, while house price to income ratios are higher than any other region.
"That would lead you to conclusions about debt levels that underpin the rise in house prices," he said. "[But] we don't want to start using monetary policy to deal with financial stability issues or risks that we see around the Auckland housing market."
He cites the experience of the Swedish central bank, the Riksbank, which drove up interest rates to deal to a bubble in Stockholm house prices. Inflation nosedived and Sweden has only just emerged from six months of outright deflation.
That leaves the Reserve Bank looking at the toolkit available to it as the banks' regulator.
Lending to investors is about 35 per cent of residential property lending across the country and about 40 per cent in Auckland, Wheeler says.
"There is this view in New Zealand among many property owners that house prices just keep inexorably going up."
New Zealand has been spared a crash, which makes us unusual among developed countries, most of which since 1970 have at some point seen house prices fall sharply.
And the international evidence is that when that happens default rates among residential property investors are higher than among owner-occupiers, he says.
The Reserve Bank will press ahead with an increase in the risk-weighting of such loans, which affects the amount of capital banks need to hold against that part of their loan book, once it has completed consultation on how exactly to define them.
But the governor is non-committal about speculation that that is a precursor to a macro-prudential policy targeting landlords for a curb on lending akin to 2013's loan-to-value ratio (LVR) restrictions, whose impact on house prices the bank thinks is waning.
"We wanted to indicate that we are thinking about macro-prudential measures. There are no decisions.
"If we can move on an appropriate micro-prudential setting and get a clean definition, for everybody essentially, on what investor-related lending is, then it may create better clarity for us in thinking about it, if we were to introduce a macro-prudential measure."