He described his relationship with the mayor as constructive and robust.
Dr Smith said he agreed with Auckland Council's policy of building up and out.
"Oh, yes, I do. And there's a lot more agreement between the Auckland Council and the Government than what some might have you believe. We both agree that Auckland needs a lot more houses."
The council and the Government agree there is a shortage of 20,000 to 30,000 houses in Auckland and Dr Smith said the city needed about 13,000 more houses each year.
The Government was making housing policy a priority and land supply remained a key part of that.
"We need to look at the cost of infrastructure, the cost of building materials, the cost of the labour and how efficiently we're building our houses, and we need to look at the compliance costs. All five of those elements are absolutely critical if we're going to get home ownership to be more affordable."
Mr Brown welcomed the comments, saying Auckland Council was looking forward to a "constructive discussion tomorrow with the Housing Minister on how Government and council can work together on Auckland's most pressing housing challenges".
"I'm pleased the Government now agrees we need a balanced approach to Auckland's housing challenges, and I'm encouraged by the constructive tone from the minister today," he said.
The first priority should be to speed up the development of land to create more options for affordable housing, which required government support, he said.
"Our Unitary Plan plan envisages up to 40 per cent of new housing being outside the current urban limit, primarily on three clusters of new greenfields sites with capacity for up to 90,000 homes, which we are currently investigating."
The plan offered a range of choices, including more affordable housing around the city, he said, and the council would continue to push for it to take effect from September.
