Govt unveils plan to “fix housing crisis”

The Government has unveiled a suite of measures designed to make it easier and cheaper to build housing, in order to increase the supply of housing and thereby make it more affordable.

Six proposed changes are intended to free up land for development:

• Establishing housing growth targets for Tier 1 and Tier 2 councils.
• Implementing new rules requiring cities to be allowed to expand outwards at the urban fringe.
• Implementing new rules requiring councils to enable mixed-use developments in cities.
• Abolishing minimum floor area and balcony requirements.
• Making the medium density residential standards optional for councils.
• Strengthening the intensification provisions in the National Policy Statement on Urban Development (NPS-UD).

 

Housing Minister Chris Bishop said these measures would make it easier for New Zealand's cities and towns to expand both up and out.

“Our programme of reform involves freeing up land for development and removing unnecessary planning barriers, improving infrastructure funding and financing, and providing incentives for communities and councils to support growth,” he said. 

“Housing in New Zealand is too expensive, because we have made it very difficult for our cities to grow. Fixing our housing crisis will improve our economy, increase productivity, help get the government’s books back in order by reducing the enormous fiscal cost to the government, improve intergenerational equity and decrease material hardship.”

 

Housing growth targets explained

Tier 1 and Tier 2 councils will be required to ‘live-zone’ feasible development capacity to provide for at least 30 years of housing demand at any one time, compared to the current requirement of three years.

The Government will also strengthen the requirements for how councils model how much capacity is live-zoned and feasible.

 

Why more mixed-use development is being encouraged

The Government believes that greater mixed-use development will make cities more liveable and connected.

As a result, Tier 1 and Tier 2 councils will be required to enable a baseline level of mixed-use across their urban areas – which might include, for example, allowing small-scale activities such as dairies and cafes to operate anywhere within urban areas.

Tier 1 councils will also be required to enable small- to mid-scale activities like cafes and restaurants, retail, metro-style supermarkets and offices in areas subject to the NPS-UD’s six-storey (or greater) intensification requirements.

 

Why floor and balcony requirements are being abolished

These requirements, imposed by some councils, can significantly increase the cost of new apartments and limit the supply of lower-cost apartments, according to Minister Bishop. 

“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,” he said.

 

Contact me before you build

Time will tell how the Government’s reforms impact the market, but it’s clear that both sides of politics believe it’s important to build more housing.

Get in touch if you’re thinking about building a new dwelling, whether to live in or investment purposes. I’ll explain how the process works, including the financing, and organise a construction loan pre-approval for you.