The housing shortage appears to due to a lack of construction labour and materials, rather than a lack of capital.

Building consent figures have reached their highest point in almost half a century.

3700 consents were issued for new homes in the month of May, the most since the same month in 1974.

JMI Wealth director Andrew Kelleher told Mike Hosking the figures suggest far more houses would be built, if the construction industry had the capacity to get them built.

Kelleher says in the past year, there's been a clear change in the type of housing the market wants.

"People want to build houses at the moment. Residential building consents are running crazy hot."