Labour's plan to build 100,000 houses selling at about $300,000 each is a fantasy, Prime Minister John Key says.
The flagship policy was announced at Labour's annual conference and is the party's answer to the affordable housing crisis.
The Government is going to build 6000 homes with 600 of them selling for less than $400,000 at Hobsonville in Auckland.
Mr Key says Labour won't be able to deliver, particularly in Auckland where the affordability problem is much worse than anywhere else.
"They would have to be very, very small or a hell of a long way away," he said.
"This stuff is fantasy land."
Labour leader David Shearer yesterday showed off two Auckland subdivisions – built by a charity – containing $300,000 homes. Labour says the sections cost about $50,000.
But property developer Olly Newland says they're "dreaming", and it simply isn't possible to bulk buy cheap land in Auckland.
“I don't know where you can get land for $50,000 – possibly in Mosgiel out of Dunedin.
“I think it will cost five times as much, it would be cheaper to buy 100,000 caravans.”
Under Labour's plan, construction costs would make up $220,000-250,000, leaving just $50,000-$80,000 for the section.
3 News / NZN