The Government has recently unveiled its agenda to “fix the housing crisis”, with the announcement of its ‘Going for Housing Growth’ Policy. The Policy seeks to address fundamental problems causing the housing crisis by:
Freeing up land for urban development, including removing unnecessary planning barriers.
Improving infrastructure funding and financing to support urban growth.
Providing incentives for communities and councils to support growth.
The Government is currently focusing on the first of these pillars and has announced a series of changes to the RMA and National Policy Statement on Urban Development (“NPS-UD”), aimed at facilitating greater housing development and urban growth:
Establishing housing Growth Targets: Tier 1 and 2 councils[1] will be required to live-zone to meet 30 years of housing demand, as opposed to the current minimum of 3 years. New rules and guidance will be introduced to assist councils to calculate housing capacity.
New rules to enable outward expansion at the urban fringe: this will include improvements to Future Development Strategies to make them more responsive to development opportunities, and to better support developers in progressing private plan changes. Importantly, councils will no longer be able to impose rural urban boundaries – plans can still include land zoned for rural use, but councils will not be able to set hard regulatory boundaries that constrain growth.
Strengthening the intensification provisions in the NPS-UD: changes to the NPS-UD requirements to ensure that capacity is enabled in locations where there is demand and good connections to businesses, services, and transportation. These changes will include:
Making the medium density residential standards (“MDRS”) optional (refer below).
Requiring Tier 1 councils to enable heights and densities commensurate with levels of demand and/or accessibility to businesses and services.
Requiring Tier 1 councils to identify strategic transport corridors and upzone around these corridors.
Clarifying the rules around the application of qualifying matters which can operate to reduce density.
Enabling mixed-use development: New national direction which will include rules requiring councils to enable mixed-use developments across urban areas.
Abolishing minimum floor areas and balcony requirements: Councils will no longer be able to set minimum floor area requirements or require balconies (although developers may still choose to provide balconies and size dwellings in accordance with market demand).
Making the Medium Density Residential Standards optional: MDRS will become optional. Councils will be required to carry out a ratification vote to determine whether they intend to retain, alter, or remove MDRS from urban areas.
The announcement is a show of support for development and intensification. In principle, the proposed changes appear to be practical steps to improve housing supply by removing barriers to development.
Decisions on the remaining two pillars of the ‘Going for Housing Growth’ Policy will be made over the next year. The Government has signalled that it will be making further announcements will include improvements to the rental market for tenants and landlords; building and construction changes to improve competition and lower building costs; better social housing; and further reform of the RMA.
Consultation on the changes is expected to occur in early 2025. More information is available here. If you would like to discuss these changes, feel free to reach out to one of the ChanceryGreen team.
[1] As defined in the National Policy Statement on Urban Development 2020. This includes 24 city, district and unitary councils, including Auckland, Hamilton, Wellington and Christchurch.