Australian spinner Nathan Lyon described unbeaten New Zealand batsman Rachin Ravindra as a budding "superstar" on Saturday but says the tourists are still well placed to win the first Test in Wellington.

Ravindra struck an eye-catching 56 not out as the home side reached 111-3 at stumps on day three, having stumbled early in their pursuit of a lofty 369 to win the opening match of the two-Test series.

Daryl Mitchell was on 12, with the pair having put on 52 in 20.3 overs together to give New Zealand a glimmer of hope in difficult batting conditions.

Lyon took 2-27 -- aided by some brilliant catching from Steve Smith -- to give him six wickets for the match.

Lyon shapes as a key figure in preventing New Zealand from scoring the remaining 258 runs they need on a Basin Reserve pitch taking turn and bounce.

New Zealand part-time spinner Glenn Phillips earlier capitalised on the conditions, snaring career-best figures of 5-45 as Australia were bundled out for 164 in their second innings.

Ravindra, who scored 240 in the first Test against South Africa last month, defied Australia late in the day with a series of aggressive strokes in his 94-ball knock.

Lyon said it will be crucial to quickly remove the 24-year-old, who scored three centuries at last year's 50-over World Cup.

"Rachin seems like a really good player," Lyon said.

"This is the first time I've bowled to him -- I watched a lot of him during the World Cup and he's going to be a superstar. Credit where it's due, he's played very well here.

"But I know if we can put pressure on them and challenge their defence for long periods of time, hopefully we can crack them."

- 'Dream come true' -

Mitchell was fortunate to survive an early stumping chance off Lyon, when the ball evaded the gloves of wicketkeeper Alex Carey, with the charging batsman well out of his ground.

Lyon was introduced in the sixth over of New Zealand's innings and quickly removed opener Tom Latham before claiming the key wicket of Kane Williamson, when Smith pouched a sharp catch at leg slip.

Smith's second catch was even better, to remove Will Young for 15 off part-time spinner Travis Head, reacting quickly to a fine edge that went low and to his left.

Earlier, Australia lost their last six wickets in the space of 13 overs, with Phillips producing the best figures by any New Zealand spinner on home soil in 18 years, complementing his 71 with the bat in New Zealand's first innings of 179.

Phillips, thanked captain Tim Southee for giving him the opportunity for a rare long spell.

"It's absolutely a dream come true. Timmy's an incredible captain. He gave me the confidence to go out there and stick to my plan," Phillips said.

"I never thought it would be in home conditions I could take a five-for. I definitely thought it would be more in the sub-continent."

Two wickets fell in the first session, nightwatchman Lyon departing for Australia's top score of 41 and opener Usman Khawaja for 28 after they resumed at 13-2.

First-innings centurion Cameron Green scored 34 and Travis Head 29 but the end of their 46-run partnership for the fifth wicket sparked a collapse.

Head miscued Phillips to be caught at long-on, before the spinner removed Mitchell Marsh and Alex Carey to close catchers and Henry bagged the last two wickets to finish with 3-36.