Migrants - especially the skilled ones - can help raise everyone's living standards. However, you can have too much of a good thing, particularly if those migrants are low-skilled. Congestion and housing are some of the downsides of excessive immigration, although really those problems stem from poor government policies and planning. Every time population growth hits 2% we seem to see these problems, which is why TOP is suggesting a target of 1% population growth through migration, at least until these infrastructure bottlenecks can be solved.
However, we must recognise that we cannot control a lot of migration, so promising any such target is illusory. Citizens and residents have freedom of movement so we can't control what they do. Fewer Kiwis leaving and more returning home have been a major source of the current problems.