'Bubble bound to burst' says Peters

"It isn't rocket science to say that it is the law of supply and demand," explained Peters. Photo / John Borren

Fixing Auckland's housing woes isn't "rocket science" and should be the top priority in government's budget, New Zealand First leader Winston Peters says.

Finance minister Bill English will present government's annual spending plan on Thursday.

The most anticipated chapter will be Auckland housing's debacle and how the government will look to fix rocketing prices and a serious supply problem.

NZ First leader Winston Peters told TV1's Q + A this morning that housing affordability should be the top priority.

The government should be building houses "at the base level" for people to get on the property ladder and restrict land-banking by foreign investors, he said.

"We've got a huge bubble building here in Auckland particularly. It's going to burst one day, maybe not too far from now.

"It isn't rocket science to say that it is the law of supply and demand."

Mr English said Auckland housing was absolutely on the agenda - but said the government was not relying on the budget to deal with the issues.

It was part of an "ongoing process" between the government and Auckland Council, he said.

"This budget will be focussing on the same sort of areas we've focussed on before, so part of it is about doing what we can to sustain this moderate economic growth.

"At the moment, the factor that could potentially have impact on that has been the much-discussed Auckland housing market."