Ngati Whatua has withdrawn legal proceedings it launched over the sale of Crown land in Auckland.

The iwi was concerned plans to sell Crown property for residential development in Auckland could breach their right of first refusal to buy surplus Crown land.

Housing Minister Nick Smith said an agreement has now been reached with all Auckland iwi where they will be able to get on and use vacant public land for housing - while ensuring Treaty settlements covering the region are upheld.

He said the agreement reinforces the right of first refusal protocol, and also sets out further ways for the Government and iwi to work together on housing.

That includes a commitment of 20 percent of new houses delivered through the Auckland housing programme to be made available for purchase by community housing providers, and for a further 20 percent to be priced as affordable for first home buyers.