John Key is warning voters there is no "free lunch" in the Northland by-election, as National claims major roads and free-trade deals will be in doubt if Winston Peters wins.

Key and a wave of National MPs were back in Northland on Thursday, where candidate Mark Osborne is locked in a battle with the NZ First leader to replace Mike Sabin, who resigned as Northland MP for personal reasons.

Polls have showed Peters and Osborne are neck and neck, while Labour leader Andrew Little has signalled its supporters might vote tactically to undermine the Government - which could help NZ First to take the seat.

Should National lose Northland, it would need to convince two of its three support parties - ACT, United Future and the Maori Party - to support any future legislative changes.

Speaking to Turners & Growers in Kerikeri yesterday, Key said "all the other parties [were] ganging up on National" making the contest difficult.

If National lost the seat it had held for more than half a century, there could be consequences, such as throwing into doubt the South Korean free trade agreement (FTA) he is due to sign in Seoul this month, because it would require a vote in Parliament.

"If we lose Northland, it's not costless," Key said.

"We may not be able to pass it - it's not a free lunch if you think about it. From our point of view, we actually need to hold that seat if we can, for what we like to do.

"As we can see with the other political parties, they're all over the place when it comes to FTAs."

Osborne, who has risen from electorate treasurer to potential MP in just weeks, even warned a flagship National roading project to extend State Highway 1 as a motorway further into Northland, could be derailed if Peters beat him.

"If the people of Northland want the Puhoi to Wellsford motorway extension, which is vital to open up Northland to our biggest market . . . if we want that, there's only one choice, and that's to vote for me," Osborne said.

If he lost the by-election there was a "real risk" the road might not go ahead.

Although it is understood the Puhoi to Wellsford motorway is yet to receive final signoff, the Government is reportedly planning to announce a start date soon, possibly as part of the by-election strategy.

Peters dismissed the claims by Key and Osborne, which he believed were designed to scare voters towards National.

"Two weeks ago Mr Key said I had no chance and was engaged in a stunt," Peters said.

"Now he's plain scaremongering.

"We know we're not going to change the Government, but we are going to change the way they have neglected the north."

Losing the Northland by-election would be likely to weaken the Government's ability to reform the Resource Management Act, with United Future and the Maori Party indicating they opposed the proposed changes.