ASB economist Christina Leung says the Reserve Bank is likely to wait until March to increase benchmark interest rates, despite house prices reaching an all time high.
Realestate.co.nz says the average asking price hit a record $465,000 in July, $10,000 higher than the previous record set in May, and a 9% rise on June. In Auckland, the average asking price in July was $639,685.
To ease prices, the Reserve Bank has proposed high loan-to-value ratio mortgages requiring some borrowers to provide a 20% deposit.
Ms Leung says the bank failed to report on the proposal last month, which could suggest it's struggling with the policy.
She says there is a possibility that there are still some implementation details that the Reserve Bank still needs to work through.
"We think that these tools will only have a modest impact on the housing market and that the Reserve Bank will still need to raise the OCR in March next year."
Ms Leung says the Reserve Bank is currently having to balance rising housing market pressures with inflation still reasonably subdued.
She says demand is continuing to outstrip supply in the housing market enhanced by an increase in net migration.
Ms Leung says issues outside of the Reserve Bank's control need to be addressed before house prices can cool, such as increasing land supply.
HSBC predicts growth in house prices
HSBC says house prices are on track for double digit growth this year for the first time in five years.
It says its modelling, based on Reserve Bank internal methods, suggests house prices could rise by more than a tenth this year, and 9% next year.
HSBC says low rate home loans, low housing stocks in Auckland and Canterbury and rising migration are pushing prices higher.
It says the Reserve Bank's planned loan restrictions could be a minor brake on the housing market, but they won't be a game changer.
And it says house prices are unlikely to fall until interest rates begin to rise.