New Zealand Prime Minister John Key has announced his resignation, saying he was “leaving on my own terms”.

Mr Key said it had been a privilege to serve his local constituency, and said he would stay in parliament long enough to avoid a by-election.

He said there was no way he could have served out a full fourth term and he did not want to mislead the public.

“I gave it everything I had,” he said.

Mr Key said he wanted to make room for new talent.

“One of the things that I have always believed in is making room for new talent and let’s be blunt – I have taken the knife to some other people and now I am taking the knife to myself to allow others to come through and have those opportunities, and that is a healthy thing,” he said.

“We have got a caucus that is full of talent. We shouldn’t be afraid of that.”

Mr Key cited family reasons for leaving, saying “those who are dearest to me” have made significant sacrifices as a result of the job.

He made note of his wife, Bronagh who has endured “many lonely nights” and his two children, Stephie and Max, had been put under “extraordinary levels of intrusion”.

“Bronagh has made a significant sacrifice during my time in politics, and now is the right time for me to take a step back in my career and spend more time at home,” he said.

Fine innings from John Key. Not
Many pollies retire unbeaten on a double ton.

— Tony Abbott (@HonTonyAbbott) December 5, 2016

Mr Key, who has been New Zealand’s Prime Minister since 2008, said his legacy would be stabilising and growing the country’s economy following the global financial crisis and weathering crises like the Christchurch and Canterbury earthquakes.

Failing to ratify the Trans Pacific Partnership, not changing the national flag and and not opening the Kermadec Ocean Sanctuary were his main regrets.

Mr Key said while he would support whomever caucus chose as prime minister, he endorsed Bill English as his replacement.

“Whoever the caucus votes for will have my unwavering support, but if Bill English puts his name forward then I will vote for him,” he said.

“For 10 years now Bill and I have worked closely as a team. I have witnessed first-hand his leadership style, his capacity for work, his grasp of the economy, his commitment to change and most of all his decency as a husband, as a father, a colleague and as a politician.”

The next election will be held before November next year.

‘So it ain’t so bro’: Turnbull

Speaking soon after the news, Australian Prime Minister Malcolm Turnbull said he had heard about Mr Key’s resignation before it was announced publicly and sent his Kiwi counterpart a short message.

“‘Say it ain’t so bro’, (I wrote),” Mr Turnbull said. 

“He will be a great loss to New Zealand and a great loss to the world. John Key is one of the most outstanding national leaders in the world today.

John Key and Malcolm Turnbull at the Bataclan memorial in late 2015, shortly before the G20 summit in Turkey. Photo: Getty.

“He has done an extraordinary job for New Zealand. He is somebody that all of us, right around the world, leaders in countries large and small, draw inspiration from.

“What he has been able to do is demonstrate that if you make the case for reform, clearly cogently, persuasively, you can win and retain strong public support for economic reform. That is what he has done in New Zealand.”

“New Zealand has never been better situated than it is today. They are going very well. He is leaving the economy in very strong state. The Budget is in surplus, economic growth is strong. That is due to the outstanding leadership John has shown.”

President Barack Obama (L) and John Key playing golf in Hawaii in early 2014. Photo: Getty.

Mr Turnbull said Mr Key had been a “very influential player on the world stage”.

“I have been to many international conferences with John Key and his words are heard with a respect and an attention that is way out of proportion to the size of New Zealand,” he said.

“New Zealand has never boxed above its weight as much as it does or as it has done with John Key as its Prime Minister. He is truly outstanding.”