High house prices are creating a class system in New Zealand that's frighteningly similar to that of Britain, economist couple Shamubeel and Selena Eaqub claim in their new book Generation Rent.

In fact, the pair dub property-owners as this country's "modern landed gentry" whose fortune in owning homes will be passed on to their children.

Though they don't use the term, in a country with property landed gentry, those unable to afford houses are clearly property peasants forever paying rents to the gentry, dependant on their goodwill not to be evicted.

Shamubeel has long been the lone voice of choosing to rent rather than buy high-priced housing, but in Generation Rent he and Selena seek to describe how house prices got so high, and the changes the country needs to make to create an adequate supply of new, fairly-priced housing.

"The trend since the early 1990s has increasingly pushed New Zealand towards a new class system, with house owners- a kind of modern-day landed gentry- at the apex," they write.

"This is a serious and persistent attack on New Zealand's identity as an egalitarian society where social and economic success are open to all.

"In the future, it may be that only the children of home owners will be able to own homes, because few will otherwise have sufficient incomes to buy on their own.

"Such an inheritance-based class system goes against the grain of what New Zealand is supposed to aspire to: an equitable and egalitarian society."

If that sounds dramatic, it's meant to be, with the Eaqubs seeking to capture public attention in a similar way that happened when he dubbed some of our rural towns "zombie towns" to focus the spotlight on failing rural centres.

The yields being accepted by property investors indicate they expect house prices to rise at around 8 per cent a year forever, the pair write.

If that were to happen, the effects on home ownership levels would be devastating.

"If household incomes continue to rise at their historical rate of 3.5 per cent per year and house prices rise at the 8 per cent a year that investors expect, mortgage payments will be a staggering 80 per cent of a young couple's income by 2020 - and more than their annual income by 2031," they say.

High house prices in cities are a result of many factors including banking regulations that have favoured mortgage lending and restricting the land on which homes may be built, but the housing problem was "eminently solvable", Shamubeel said.

He was "cautiously optimistic" the political wind was changing, though as yet he still saw a lack of political courage and leadership needed to confront powerful vested interests.

He said immediate actions that should be taken included passing tenant-protection laws, including long-term tenancies, to improve the lot of those who choose, or, more commonly, have been forced into renting.

He and Selena would also like to see a reworking of the tax breaks property investors get including "ring-fencing" losses on negatively-geared properties to "ensure that residential properties stand on their own merits … rather than hiding behind a tax shield".

And they want to see a fundamental re-working of the banking sector.

"International rules allow banks to hold relatively little capital against their housing loans, creating a strong bias towards residential mortgage lending."

This has seen mortgage debt in this country spiral up to more than $200 billion.

Shamubeel denied making such calls required bravery, though acknowledged they may not make him popular in all quarters.

"I don't think anybody thanks you for attacking the business model that helps them makes lots of money," he said, but added that much of what he and Selena are calling for is "fairly obvious stuff."

Shamubeel is open to speaking with landlord groups, and does not blame investors for taking advantage of the systematic failure to build enough houses. "It's only natural and human that people would," he said.

Generation Rent also takes on the fears that "foreign buyers" are inflating prices.

The Government should gather more data in order to understand the impact of foreign ownership of houses, the Eaqubs say, by collecting the IRD number, tax residency and purpose in buying for the sale of all residential properties.

They would also have the deals settled using funds from a New Zealand bank as a means of stopping money laundering through our property market.

No matter what politicians decide to do, however, there was a lost generation who were trapped outside the property market, Shamubeel said.

That is going to spell financial trouble for them as New Zealand Super was designed to be just enough for people who own their own homes, Shamubeel said.

Many lifelong renters would find it hard to live on NZ Super, he said.