PHOTO: Housing Minister Chris Bishop. FILE
Housing Minister Chris Bishop has announced the government’s ambitious plan to “flood the market” with housing development opportunities. This initiative aims to make housing more affordable by implementing a series of changes designed to free up land for housing and streamline development processes.
Key Plans and Implementation Strategies
Housing Growth Targets for Tier One and Two Councils
The government will set growth targets for tier one councils (including Auckland, Wellington, Christchurch, and Tauranga) and tier two councils (such as Whangārei, Rotorua, New Plymouth, and Dunedin). These councils will be required to “live zone” land with sufficient feasible development capacity to meet 30 years of housing demand.
“Live zoning” means the land is immediately available for development under existing plans, ensuring commercial viability for developers.
Brad Olsen, Infometrics chief executive, acknowledged the challenge for councils in planning for 30 years’ worth of development without existing infrastructure. However, he emphasized that the more permissive zoning options could accelerate infrastructure development over time.
Expansion Beyond Urban Boundaries
Councils will no longer be allowed to impose rural-urban boundary lines in their planning documents, though they can still designate land as rural. The government is also considering requiring councils to plan for growth over 50 years instead of 30.
Strengthening Urban Development Intensification
Tier one councils must enable appropriate density levels across urban areas, particularly along major transport corridors. They are also required to compensate for any development capacity lost to special character areas by increasing development elsewhere.
Mixed-Use Development
Tier one and two councils will need to allow mixed-use developments, including cafes, dairies, and other retail establishments in urban areas, while still keeping industrial activities separate from housing zones.
Removal of Minimum Floor Area and Balcony Requirements
Developers, rather than councils, will decide on the size of apartments and whether they include balconies. Bishop pointed out that these requirements significantly increased the cost of new apartments, citing a 2015 study that showed balcony size requirements added $40,000 to $70,000 per unit in Auckland.
Professor John Tookey from AUT’s School of Engineering noted the need to balance cost reductions with maintaining essential living standards.
Optional MDRS
The Medium Density Residential Standards (MDRS), a bipartisan agreement between National and Labour, will become optional. Councils currently required to implement the MDRS can vote to retain, alter, or remove its standards, provided they meet housing growth targets and the new intensification and mixed-use provisions.
Potential Impact on House Prices
Brad Olsen expressed optimism about the plan’s potential to improve the housing market. He believes that any increase in housing supply is beneficial. Professor John Tookey agreed that the new rules might lead to more apartment constructions, though it might not necessarily make other housing types more affordable.
Nick Goosall, Corelogic head of research, welcomed the changes, emphasizing that any development must be viable for builders and developers to utilize the new rules effectively. He cautioned that it would take time for these changes to significantly impact the market but affirmed that the government’s approach is the right one.
SOURCE: RNZ