Property valuers say investors now account for nearly half of all sales at the low end of the price range in Auckland, largely at the expense of first home buyers.
Sean Wood is a prolific property investor who now teaches students how to extract maximum returns from the Auckland housing market. In return they each pay him up to $30,000 a year.
"We buy old houses and then we build instant capital gain into them through renovations...then if we hold them we get the market capital gains so we actually get paid twice. Perfect," Mr Wood says.
Most houses bought by his students are renovated and on-sold quickly. And these investors aren't just doing one at a time.
"Some of the clients today are buying and selling between five and eight properties a month and are doing between three or four at any one time," says Mr Wood.
The investor could be trading up to 100 houses a year as they ride the wave of capital gain.
NZIER Principal economist Shamubeel Eaqub says because the market is rising so fast people want to get in as quickly as possible and as deep as possible.
"These are all the sorts of hallmarks we've seen internationally of a market that is getting frothy - getting very speculative and being driven by the greed and need for capital gains," Mr Eaqub says.
But Mr Wood doesn't believe Auckland will ever be in a housing crisis and he doesn't see the market slowing down any time soon.
And he has some free advice for first home buyers feeling the squeeze.
"Go and get yourself on the property ladder - hey if that means going and buying something in Hamilton and rent it out to somebody."