A new report is highlighting a drop in productivity because of high housing costs.

The ANZ report says young Kiwi's spend a long time saving for a deposit for their first homes, which means they are not thinking about how to use that capital for business ventures.

Senior economist Liz Kendall says this is making it difficult for businesses to find new young people who are in a position to take over the reigns and invest in businesses.

"High house prices limits peoples ability to move and work where suitable jobs are, particularly if they are in the cities where it's very expensive."

Kendall also says because of this happening, it's having an impact on businesses succession planning.

"It is difficult for businesses to find new young people who are actually in a position to take over the reigns and invest in businesses so that they can keep operating and being productive."

There are concerns that high house prices will continue having a flow on effect on productivity for the forseeable future.