Government announces bipartisan Bill aimed at addressing New Zealand’s housing shortage

On 19 October 2021, Labour and National announced a bipartisan Bill aimed at addressing New Zealand’s housing shortage. The Resource Management (Enabling Housing Supply and Other Matters) Amendment Bill proposes to cut the red tape that is currently obstructing housing development in some parts of the country.

To do this, the Bill proposes to strengthen and bring forward the implementation of the Government’s National Policy Statement on Urban Development (NPS-UD) issued in July 2020. This statement was directed at supporting greater housing density in urban areas. It classified urban areas as either tier 1, tier 2, or tier 3. New Zealand’s largest cities- Auckland, Tauranga, Hamilton, Wellington, and Christchurch were classified as tier 1. Napier and Hastings have been classified as tier 2. While a separate process to the replacement of the Resource Management Act, the NPS-UD will remain in effect under the new system.

The Bill would require tier 1 councils to implement ‘medium density residential standards’ outlined in the NPS-UD from August 2022. These standards specify that landowners can build up to three homes of up to three storeys on most sites without the need for resource consent. Currently, landowners can typically build one home of up to two storeys per site.

This change would intensify houses in tier 1 urban areas, with the aim of lowering house prices and making home ownership more attractive to prospective buyers. It would provide first home buyers and developers with more certainty and enable increased housing development in areas close to public transport and community facilities. The belief is that changes in this Bill will likely result in between 40,000 and 100,000 new homes being built in the next 5-8 years.

Some sites would be exempt from this change. For example, housing intensification would be inappropriate on heritage sites, or sites where natural hazards are likely.

Some tier 2 areas-including Napier and Hastings-may be required to adopt the medium density residential standards if the Minister of Housing and Minister for the Environment consider there is an acute housing need in those areas. So, while the Bill does not immediately affect Hawke’s Bay, it may do so in the future.

The Bill has been introduced to Parliament with opportunities for public comment by Tuesday 16th November 2021. Labour and National hope to pass the Bill in December 2021, with expectations that the Bill will be passed due to cross party consensus regarding the severity of new Zealand’s housing shortage.

If you have any questions about how this Bill may affect your development plans throughout the country, or create new opportunities, please don’t hesitate to contact us and a member of our team will be happy to advise.

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