Watch: Housing minister reveals housing, planning changes to ‘flood’ country with new homes

Housing Minister Chris Bishop has unveiled the six major changes the government plans to make to boost housing growth in New Zealand.

They include getting rid of minimum floor area and balcony requirements for apartments and rules to allow cities to expand outwards at the fringes.

In a statement, he said the changes would free up land for development and remove unnecessary planning barriers and “ensure abundant development opportunities in our key urban areas” by making it easier to build new houses.

The changes are:

  • The establishment of Housing Growth Targets for Tier 1 and 2 councils
  • New rules requiring cities to be allowed to expand outwards at the urban fringe
  • A strengthening of the intensification provisions in the National Policy Statement on Urban Development (NPS-UD)
  • New rules requiring councils to enable mixed-use developments in our cities.
  • The abolition of minimum floor area and balcony requirements
  • New provisions making the MDRS optional for councils

– Read the government’s fact sheets and Bishop’s speech here

The housing growth targets would require councils to “live-zone” development capacity to provide at least 30 years of housing demand at any one time, a shift from the current three years of live zoning.

“This will ensure abundant development opportunities in our key urban areas,” he said. “The government rejects the view that cities can only grow outwards, as well as the view that density is the answer to everything,” Bishop said.

The zoning requirements would apply to 24 councils, demanding the use of “high” population growth projections, and ensuring price indicators – such as the price difference for rural and urban zoned land – would not change.

“In effect, this will flood the market with opportunities for development, and over time, drive down land prices and the cost of housing.”

He said the city fringe changes would mean people could build there as long as they covered the costs of the associated infrastructure.

“In other words, where ‘growth pays for growth’. Councils would not be able to turn down a development on the grounds that perceived demand isn’t there, or that the infrastructure costs are too high.”

Councils would also be unable to impose rural urban boundaries.

“This doesn’t mean they can’t have land zoned for rural use, but it does mean they can’t set hard regulatory boundaries that constrain growth. Many political parties and many governments over many years have said they would do this: our government will be the one to finally deliver it.”

He said changes to the National Policy Statement on Urban Development would ensure that housing capacity “is enabled is in locations where there is demand and that are well-connected to businesses, services, and transportation”.

“We will require greater density around strategic transport corridors not just rapid transit, simplify the definition of ‘rapid transit’ to avoid further boring and interminable debates about what counts as ‘rapid transit’, clarify the definition of ‘walkable catchments’ in the context of centre zones and rapid transit, and clarify the rules around unlisted ‘qualifying matters’ which allow councils to avoid enabling intensification,” he said.

The govenrment would also require councils to set aside equivalent capacity for development if capacity was lost.

Another change would increase mixed use development, in a similar approach to that taken by other countries around the world. Tier-1 councils would be required to allow “small to mid-scale” activities like cafes, metro-style supermarkets, restaurants and offices in residential areas.

“Our cities need to look and grow the way that people actually want to live, not the way a tidy-minded planner in a council cubicle think people should live.

“We need more apartment buildings with cafes and supermarkets in the bottom. We need small bodegas and boutiques and cafes in the types of environments that New Zealanders often travel overseas and come home and ask ‘why can’t we be like that here’.”

The removal of minimum floor areas and balcony requirements would remove rules imposed by some councils that could significantly increase the cost of new apartments and limit supply of lower-cost apartments, he said.

“Evidence from 2015 shows that in the Auckland market, balcony size requirements increased the costs of an apartment by $40,000 to $70,000 per unit.”

“You sometimes hear people complain about all these shoebox apartments, and I agree they’re not the right housing solution for everyone. But you know what’s smaller than a shoebox apartment? Cars, and tents that people are living in right now.”

The Medium Density Residential Standards are a rule brought in under Labour which required major cities to allow up to three homes of up to three storeys to be built on a single lot.

The move initially had National’s support, with then-National leader Judith Collins and then-Housing spokesperson Nicola Willis announcing the plan alongside Labour’s Megan Woods.

It passed with National’s backing in 2021.

However, National pulled its support for the policy after Christopher Luxon took over the leadership, saying they had got it wrong.

Bishop said it was “a well-intentioned move to liberalise urban land markets but was too much a one-size-fits-all solution.”

All councils would be required to vote on whether to retain, alter or remove the rule from their urban areas – but the housing growth targets would be mandatory.

The ACT Party claimed credit for the “end of Labour’s compulsory intensification rules”, saying “sanity has returned to housing policy only after encouragement from ACT”.

“Councils up and down the country were rejecting the law, and now we’re giving them back control over what happens in their community.”

Formal consultation on the design of the changes will take place early next year. These would be the “first pillar” of the government’s housing policy.

The government signalled it planned to make decisions about further over the next year on the second and third pillars: for improving infrastructure funding and financing, and providing incentives for communities and councils to support growth.

Labour warns changes risk ‘shambles’

In a statement, Labour’s Housing spokesperson Kieran McAnulty said the party was open to supporting measures that would lead to more housing – where that was “likely to work”.

“But not at the expense of building standards or loss of elite productive soil. There is an opportunity here, but the short-term thinking means it runs the risk of ending as a shambles.

“It’s all well and good to want to ensure development opportunities, but unless the government fronts with infrastructure money, councils are limited in what they can offer by ways of expansion.

“This shouldn’t be used as a way for the government to avoid difficult discussions about density or fronting up with funding.”

He said Bishop’s announcement today may look good on paper, but it had not been thought through, “and the government has again opened themselves up to being all talk”.

Labour leader Chris Hipkins earlier told RNZ’s Morning Report deregulation of housing would need to be handled carefully, to prevent long-term problems like the leaky homes debacle.

According to the news on Radio New Zealand

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