New Zealand's Labour leader Andrew Little is defending the release of controversial data appearing to show many offshore Chinese are buying Auckland houses.

Labour has come under fire after housing spokesman Phil Twyford released figures from an unnamed real estate firm over the weekend showing 40 per cent of houses sold in Auckland between February and April went to people with Chinese surnames.

The most recent census data shows about nine per cent of Auckland's population is Chinese and Mr Twyford says the discrepancy in the figures points to offshore Chinese investors having a significant presence in the Auckland real estate market.

Labour has been accused of playing the race card and others have questioned the reliability of the data, which covers about 4000 transactions over a three-month period.

"We verified it and we're satisfied that the house sales information is accurate," Mr Little told TV3's Paul Henry show on Monday.

"It is crude, but the gap is so big that you can, I think, conclude that a large chunk of that 40 per cent is coming from non-resident buyers."

If it got into government, Labour would ban non-residents living overseas from purchasing existing homes and instead require them to build new homes, Mr Little said.

Building and Housing Minister Nick Smith says Labour is "playing the oldest political trick in the book in picking on one ethnic group".

"Their data is not reliable - it's from one real estate agency and makes guesses at who is a New Zealander and who isn't," he said.

Dr Smith says the housing issue is about supply.

"That's why the government's focus is on getting more houses built."

The analyst who crunched the numbers for Labour, Rob Salmond, has defended the research.

In a blog post, he said the large discrepancy between the number of Chinese residents and Chinese buyers, plus statistics about the incomes of Chinese residents pointed to foreign buying.

"Can Labour prove that any individual buyer is foreign? No. All we have is their last name.

"But can Labour conclude ... from the aggregate data that there is likely a large impact of offshore investment from China in Auckland's real estate market? Yes."