The Government's big stick to encourage housing-building might be a damp squib in Queenstown, local council staff warn.
And they say an uncontrolled release of land for development might threaten the district's world-renowned landscapes.
Earlier this month, Housing Minister Nick Smith released details of a new national policy statement to force councils to provide enough land to match population growth projections.
While the policy's target is Auckland, four other councils, including Queenstown, would have to set a minimum long-term target for building houses.
In a report to Thursday's full Queenstown Lakes District Council meeting, senior policy planner Kim Banks said the preliminary conclusions of council staff were that the proposed policy "is unlikely to have any significant benefit in Queenstown''.
Further, it oversimplifies the complexities of land supply, putting weight on the influence of land zoning on house prices while not addressing other issues, such as land-banking, loss of housing to visitor accommodation and high building costs.
"It will create additional compliance and reporting responsibilities for council, without achieving meaningful benefits to the availability or affordability of land,'' the report said.
There was also a risk of compromising the district's landscapes, Ms Banks said.
A separate document of "suggested submission points'' for councillors said an uncontrolled land release for development was inappropriate in a sensitive environment, noting Queenstown was the 'jewel' in the country's tourism crown.
Dr Smith's press secretary, Sharon Lundy, said: "The consultation process is ongoing and the minister is unable to comment on submissions.''
Submissions on the draft national policy statement on urban development capacity close on July 15.
Ms Banks suggested the council lodge a detailed submission.
The QLDC signed a Housing Accord with the Government in October 2014 with the aim of providing an additional 1300 houses in the Wakatipu Basin over three years.
The targets are being smashed, with 956 consents for new sections and dwellings being issued by April 30, but it has not slowed house prices.
Last month, the Queenstown median price had rocketed to $818,500, according to Real Estate Institute of New Zealand figures, a rise of 46% from the October 2014 median of $561,500.
The Government is also pushing so-called special housing areas, a red tape-cutting way of fast-tracking subdivisions, to free up land for houses.
Dr Smith approved four new special housing areas around Queenstown last Thursday. The developments, spread over 40ha, have the potential for 490 new houses.
