Government Plans to Enhance Urban Housing Development
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- The Government aims to ease building new houses in existing urban areas.
- New policies will enforce higher density around transport corridors.
- Councils can opt for medium-density requirements based on local conditions.
The Government is taking a new approach to urban development, rejecting the notion that cities can only expand outward or that increasing density is a universal solution. According to Bishop, “The Government will make it easier to build new houses in existing urban areas, as well as work towards establishing an effective ‘right to build’ new houses on city fringes, provided the infrastructure costs of new development are covered and growth pays for growth.”
Additionally, the Government plans to “significantly strengthen” density requirements by urging councils to zone for greater density around “transport corridors.” Bishop explained, “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.”
To promote mixed developments, Bishop expressed a desire to see more varied usage in urban areas, requiring tier one councils to support a baseline level of mixed-use. He suggested this could include “allowing small-scale activities such as dairies and cafes to operate anywhere within urban areas.” Moreover, tier one councils will be expected to enable small-to-mid-scale activities “like cafes and restaurants, retail, metro-style supermarkets and offices” in zones with six-storey or greater intensification requirements.
In a move to reduce costs and increase housing options, the Government will abolish minimum size requirements for apartments and balconies. Bishop highlighted, “These requirements, imposed by some councils, can significantly increase the cost of new apartments and limit the supply of lower-cost apartments. 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.”
Finally, councils will have the option to meet medium-density residential standards (MDRS), which were made law in 2021. Bishop acknowledged this flexibility is “legally tricky as the MDRS was passed into law in 2021.” However, he noted, “Different councils are at different stages, and eight of the relevant 15 councils have already completed plan changes.”
“Solving our housing crisis will mean a more productive, wealthier and better New Zealand and today’s announcements are a step on the journey,” Bishop concluded.