Fewer people own their homes, with ownership dropping most for people in their 30s and 40s, according to official figures.
But the Government says that while ownership is declining, the decrease is less pronounced when homes owned by trusts are taken into account.
Statistics NZ figures from last year's Census show home ownership is trending down, with just under half of all people living in a house they own or partly own. The 49.8 per cent home-ownership in the Census was down from 53.2 per cent in 2006.
Last year, just 43 per cent of people in their 30s owned their own home, down from 54.6 per cent in 2001.
But the decline in home ownership was seen across the board from people in their 20s to 70s.
After strong rises in house prices in the 2000s, prices fell nationally after the global financial crisis hit in 2007. But they have since rebounded, especially in Auckland and Christchurch, making it harder for people to get their own home.
Late last year, the Reserve Bank introduced limits on low-deposit home loans, which real estate agents say have seen a marked drop in first-home buyers in the market.
And last week, the central bank lifted the official interest rate from 2.5 per cent to 2.75 per cent in the first of what is expected to be a long run of rate rise over the next two years. Those rises are expected to see floating mortgage rates rise to about 8 per cent or more.
Finance Minister Bill English said the figures excluded homes owned by trusts which he said took home ownership to as high as 65 per cent, meaning the slump in ownership was not that pronounced.
"There has been a slow trend of a decrease in home ownership and I think you can understand that when housing has become so expensive and planning rules have put home ownership out of the reach of middle income New Zealanders and particularly young New Zealanders," he said.
English said the statistics showed the growth in new housing in the five years to 2013 was the lowest on record, contributing to house prices being driven up.
The Government was trying to address supply issues such as through speeding up new developments, he said.
While Australia was reviewing its policies around non-resident purchases, this was not being considered here.
"We haven't got any particular plans there, [but] we're keeping an eye out for it," he said.
English conceded it would be beneficial "to know a bit more" about it the impact of foreign-based buyers said it was not significant.
Green party co-leader Dr Russel Norman said the fact that ownership rates were declining was "very concerning".
The Census figures also show flats and apartments are becoming more common in big cities.
Flats and apartments now make up 37 per cent of private homes in Wellington city.
And, while the standard Kiwi three-bedroom home remains most common, the last 12 years had seen steady growth in the number of four- and five-bedroom dwellings, Statistics NZ said.
The survey also showed more people are using electricity to heat their homes, instead of gas, wood or coal.
"Electricity was the most common heating fuel in 2013, and its use increased over the previous seven years," Statistics general manager 2013 Census Gareth Meech said.
"In 2013, electricity was used for heating in 79.2 per cent of occupied private dwellings, up from 74.8 per cent in 2006, and 72.0 per cent in 2001."
- Fairfax Media