Housing is the monkey on the back of the Government that it just cannot shake.
Not only is the Auckland market out of control, but making sure there is enough affordable and good quality housing has been identified by senior ministers as a significant way of tackling poverty.
Photo: RNZ / Diego Opatowski
The Reserve Bank and the Government have both been grappling with the challenge of bringing the market back into kilter, without the bottom dropping out of house prices.
If the Auckland market is anything to go by, the loan-to-value (LVR) ratios imposed on home buyers with less than a 10 percent deposit have to be seen as dismal failure.
The Reserve Bank, however, defends their impact as having helped moderate house prices, and improve the the resilience of banks' balance sheets.
When they were first introduced opposition parties pointed out the whole country was being penalised for Auckland's woes, and argued for targeted LVRs just in the regions where they may have some impact.
For the last two elections, the Labour Party has pushed another solution; a capital gains tax, excluding the family home.
That was twice rejected by voters within Labour's broader policy package, a fact not lost on the most recently elected party leader, Andrew Little, who takes the view it is no use having a policy that may have merit, if you are not in power to implement it.
Now, however, the Reserve Bank has come out swinging, all but calling for a capital gains tax.
The strongly worded speech this week from Reserve Bank Deputy Governor Grant Spencer leaves little room for misinterpretation.
He noted there was still a problem with supply and that house prices in Auckland have tripled since 2002.
Mr Spencer warned of broader consequences; economic instability and the potential for a "disruptive correction", that is, a severe downturn that would hit both the domestic economy and financial systems hard.
He said new taxes were needed to curb rental housing investors - particularly in Auckland - as in the 18 months to February, the proportion of houses sold to investors had risen from nearly 34 percent to 37.5 percent.
New Zealand does already have a tax aimed at speculators and developers, but that is dependent on the intention of the purchaser.
If an investor buys a property with the express intention of reselling, they will pay tax on any profit.
But if the property is bought and intended as a rental, but is subsequently sold down the track, it is treated as a capital asset, and any profit is not taxed.
Clearly, the Reserve Bank does not view that as presenting enough of a deterrent for property speculation.
The Deputy Governor's comments send the clear message the Reserve Bank needs some back-up and cannot deal with this problem on its own, through mechanisms such as LVRs and setting the official cash rate.
As for the Government, its position is becoming increasingly untenable.
Its upbeat response that the state of the Auckland housing market is actually a "success story", because more people are staying in New Zealand, is likely to infuriate rather than reassure those at the sharp end.
Ministers doggedly refuse to utter the word crisis, or admit there are actions they could take to dampen demand - that would be tantamount to agreeing with opposition policy on a capital gains tax, even if Labour has gone lukewarm on the idea.
Now Labour has changed tack and is now calling for a different loan to value ratio policy - this time aimed directly at Auckland property investors, not at families or first home buyers.
Or to target those buying up large numbers of properties - the more they have, the higher the level of equity they would need to obtain credit.
The Government has deployed its usual argument in response, that such measures, or a capital gains tax, are blunt instruments and the way to fix the problem is to increase supply.
It is obviously not an issue that has escaped the Prime Minister's notice - after the election he spread the responsibility for housing across three of his senior ministers, Bill English, Nick Smith and Paula Bennett.
At the last year's National Party annual conference, policy to free up land for residential building was announced, and access to Kiwisaver funds and government grants were the centrepiece of the party's 2014 election campaign.
But there is a consistent refusal to impose any deterrent through taxation, or respond to calls for non-resident, foreign ownership to be restricted, or even examined more closely.
Up until now it has been opposition politicians making the calls for stronger government intervention - will the message from the Reserve Bank be so easy to ignore?