The Government need to go back to the drawing board as KiwiBuild is not working for first home buyers, an economist says. But the Prime Minister is confident the Kiwibuild homes will sell despite the "bumps along the road."

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There are ten KiwiBuild homes up for sale in Otahuhu, Auckland but only one of those homes has been bought.

Ms Ardern told TVNZ1's Breakfast it takes time for people to find what they're looking for to then purchase.

“You need to allow for buyers to look through properties and purchase them. These are pretty high quality houses, two bedroom apartments and he [Phil Twyford] expects that they will sell," she said.

"I don’t think these are unwanted houses, you’ve seen the market. These houses are under $600,000 that is a rare find in Auckland and that’s the whole point of Kiwibuild only 5% of those homes that were being built in the Auckland housing market were affordable homes.”

She said it is about matching the buyer to the seller.

"We have seen some KiwiBuild homes sell quickly and we are taking up feedback from some of the developers around making the process between the buyer and the seller a bit more connected.”

The Prime Minister said there are thousands of individuals who have said they're interested in KiwiBuild.

“We have a shortage of tens of thousands of homes in Auckland, we know that we have a lack of supply that’s why it’s affecting rents we need more supply in the market."

Ms Ardern acknowledges that there has been some "bumps along the road" but she said the Government are doing all they can to address the housing crisis.

“No one has ever done this before, no one has ever, as a Government, tried to enter into the housing market and address a market failure.

"We have hit some bumps along the road, we acknowledge that. There is ironing out to be done to ensure it fits the needs of those developers and those buyers. It doesn’t change the fact that we have a housing crisis and we are working to address it.”

Earlier on the show, economist Gareth Kiernan said he believes the Government need to go back to the drawing board.

"If there's one place you'd expect the Government to be able to sell properties it would be Auckland. The fact that they aren't selling these does really cause concern."

He said there are two reasons KiwiBuild homes are struggling to sell.

“One is that the government is building stuff or buying stuff that people don’t necessarily want to buy and it’s probably a case of the price aswell, $650,000 it might be cheap for Auckland but for many first home buyers that still is a big stretch and to call it affordable is difficult.

“Given the slowing market in Auckland and the fact that they are not able to sell these, you’d struggle to call them a good steal.”

Mr Kiernan said if the Government can't sell these houses they're going to have a lot of capital tied up.

"The tax payers are sitting there looking at a whole lot of properties potentially.”

He said the Government need to go back to the drawing board as KiwiBuild is helping very few people.

"I don’t think the Government actually understands what they’re trying to achieve with the policy, they’ve talked a lot about housing affordability, but at the moment the way the policy’s been structured and the way it’s working it seems to be helping a very select few people into their first home.

“So far all he's [Phil Twyford’s] been doing is walking down the street finding a house that’s already been built and putting a KiwiBuild sticker on it and clearly that’s not answering the problems that we’re facing.”

New figures released by 1 NEWS yesterday show 74 KiwiBuild homes have now been built around the country.

Of those homes, 39 have not yet been sold - although some have only just been completed.

Mr Kiernan doubts the Government will be able the reach their targets.

“At the moment we’ve built 70 odd houses and another 300 under construction we are well behind the initial target," he said.