"He doesn't want foreigners to really come to New Zealand. He doesn't want foreigners to purchase property in New Zealand. He doesn't want New Zealanders to trade with other countries."
Mr Peters had opposed New Zealand's free trade agreement with China.
"That's a valid proposition for someone to hold; it's just not the one that I hold because if you want New Zealand to be prosperous and successful, we need to be engaged with the rest of the world."
Mr Key did not have any evidence that the issue of house sales to non-residents was a problem.
He said that trying to stop it or even collecting data on the prevalence of it would be complicated.
Mr Key also suggested that a change in the law to ban sales of houses to non-residents could reduce the value of other houses.
"If foreign are buying some houses then they are houses that presumably have been built by New Zealanders and created jobs," he said. "It probably supports the underlying value of their home at the moment."
Mr Key said issue that drove house prices up had been supply.
About 4000 new dwellings were consented over a three or four year period when there should have been at least 13,500.
"It's a supply side issue and if we continue to build houses, I think we'll cover it."
Mr Peters said people wanted certainty, not "wiffle waffle."
"We want Auckland housing, New Zealand housing, to be for New Zealand people. We want New Zealand farms for young farmers in New Zealand in particular, not to be owned by everybody around the world, and absentee owned at that."
Asked if non-resident house buying would be his top policy, Mr Peters said everybody knew that.
Asked if would be a bottom line he said "the reality is that's always been a bottom line for New Zealand First."
