On debt to income limits, currently under consideration by the Reserve Bank, Peters said it could not control the lending market.
"That's up to private lenders to decide and for borrowers to reach an agreement on.
Finance Minister Grant Robertson told reporters that everyone would like to see house prices come down. Peters' goal of no higher than five times annual income would take time to get to.
To achieve that, wages would have to rise and rate of house price rises would need to soften.
"I know that that's a goal that the Acting Prime Minister has expressed and that would be something we would like to achieve. Clearly it would take quite some time on those grounds," Robertson said.
Housing Minister Phil Twyford said Peters' suggestion would make houses twice as affordable as they were now.
The standard indicator used for affordability is median house price relative to median household income.
"In Auckland that's currently nearly 10, in Queenstown it's 11. The international benchmark for affordability is currently three," Twyford said.
Peters said houses prices no more expensive than five times the living wage, currently $20.55 an hour, were also a target.
"That will be the long-term target, yes."
Under that target, the median house price would have to be $213,720.
Twyford said it would be tough for someone on the living wage to buy their own home.
