Govt Plans Major Changes to Boost Granny Flat Construction in NZ

The new proposals will allow the construction of granny flats of up to 70 square meters on private properties without the need for resource consents or building permits.

The Coalition Government has announced significant changes aimed at easing the process of building granny flats across New Zealand. These new initiatives, led by RMA Reform and Housing Minister Chris Bishop, Associate Finance Minister Shane Jones, and Building and Construction Minister Chris Penk, will streamline the regulatory landscape, reducing barriers for homeowners and builders while ensuring greater housing availability.

The new proposals will allow the construction of granny flats of up to 70 square meters on private properties without the need for resource consents or building permits. This policy shift builds on a previous government consultation that had recommended a maximum size of 60 square meters, which received substantial support from both the public and industry stakeholders.

Currently, homeowners seeking to build a granny flat or a simple standalone dwelling must navigate a complex regulatory framework that involves both building and resource consents. The process has been criticized for being costly, time-consuming, and unnecessarily complicated, often discouraging people from pursuing housing solutions on their own properties.

Minister Chris Bishop explained that simplifying these processes is crucial to addressing New Zealand's housing shortage, particularly as the population continues to grow. “We’re taking action to ensure that New Zealanders have access to affordable housing solutions, especially for multigenerational living. Removing red tape and making the consent process simpler will lead to more homes being built at a faster rate,” he said.

The increase in maximum allowed size for granny flats from 60 sq m to 70 sq m means that families will have more flexibility in designing affordable homes for relatives, caregivers, young adults, or workers in rural areas. This shift is expected to address specific housing needs across the country, particularly for elderly parents or grandparents who wish to live closer to their children and grandchildren.

In addition to reducing bureaucratic hurdles, the Government is committed to supporting communities with the infrastructure needed to accommodate new developments. To this end, the government has introduced a National Environmental Standard (NES) under the RMA, which will be finalized by the end of this year. This NES will require local councils to permit granny flats in residential and rural zones without the need for resource consent, streamlining the development process even further.

The change is part of the broader coalition agreement between New Zealand First and the National Party to reform the Building Act and resource consenting system. In particular, this reform will make it easier to create additional housing on existing properties, reducing the pressure on the national housing market.

Shane Jones, Associate Finance Minister, highlighted the importance of supporting extended family living arrangements. “In regions like the Far North, we see large, multigenerational families living together on the same property. This new policy will make it easier for families to provide affordable accommodation for their older relatives or other family members in need of support,” he said.

Minister Chris Penk stressed that the reforms would not only benefit families but also help to support the building and construction industry. “The building sector is crucial to New Zealand’s economy, and we’re doing everything we can to remove unnecessary regulatory obstacles. By simplifying the consenting process, we’ll get more builders working on-site rather than bogged down with paperwork,” Penk explained.

The government’s plan also includes an amendment to the Building Act, set to be introduced later this year, which will exempt granny flats from needing a building consent as long as they meet specific criteria. These include:

• The granny flat must adhere to the Building Code and have a simple design

• Construction must be carried out by authorized building professionals

• Homeowners are required to notify the local council before beginning construction and once the work is completed

Additionally, the government will continue to charge infrastructure fees for granny flats through the Project Information Memorandum (PIM) process, ensuring that local councils receive necessary funding to support the growing infrastructure demands of expanding communities.

The changes are part of a larger strategy to alleviate New Zealand's ongoing housing crisis, which has seen escalating home prices and limited supply. By increasing the availability of housing options like granny flats, the government hopes to provide a more diverse range of affordable housing solutions that suit a variety of family structures and lifestyle needs.

Overall, these new policy changes are expected to increase the pace of housing construction, reduce the financial burden on homeowners, and help meet the growing demand for housing in New Zealand. As the regulations evolve, the government is confident that these reforms will create long-term benefits for families and the broader construction sector.