Local Government New Zealand says a major increase in building consent fees is a result of the leaky building crisis.
A report comissioned by an industry body, the Construction Strategy Group, found housing costs have risen 8% on average in five years and consent fees have jumped 75% in six years.
Local Government New Zealand president Lawrence Yule says district and city councils had to adopt more stringent inspection regimes to prevent a repeat of the leaky buildings crisis.
"Authorities have to give a guarantee for ten years of the quality of the work and the only way they can do that is to inspect buildings and structures as they're being built."
Mr Yule says many councils have also adopted a user pays approach to consents whereas the cost used to come from rates.
He says there is a legitimate argument that the consent costs for additions to houses, such as swimming pools, are too high and central government is already looking at fixing the problem.
Housing Minister Nick Smith says costly council fees are getting in the way of new development and in Housing New Zealand's case it has reduced the number of homes that could be built by a third.
Dr Smith says the Construction Strategy Group's study confirms council costs have soared and is hampering productivity.
He says proposed legislative changes will make development costs fairer on ratepayers and developers, providing a Development Commissioner as a neutral abritrator.