Making it easier to build granny flats was part of NZ First’s coalition agreement with National. NZ First leader Winston Peters, taking over as Acting Prime Minister while Christopher Luxon is in Japan, used Monday’s post-Cabinet press conference to announce consultation on changes that would fulfil that policy promise.
“Making it easier to build granny flats will make it more affordable for families to live the way that suits them best,” Peters said.
“Over a quarter of households that do not own their home spend more than 40 per cent of their income on housing. High housing costs have a greater impact on Māori, Pasifika, and people with disabilities, as well as seniors - so unlocking the space in the backyards of family members opens the door to new ways of living.
“We know granny flats are a great option for seniors, but they’re also increasingly popular with other families such as those who want homes where their university-age children can live at home but maintain some privacy and independence, or families who want to provide extra support to a loved one,” he said.
The Government published a consultation document on how it plans to give effect to the changes, with final decisions made later this year and legislative changes in place by mid-2025.
The changes come in two legs. The first, is issuing a National Environmental Standard (NES) under the Resource Management Act to require all councils to permit a granny flat on sites in rural and residential zones without resource consent. This means that so long as the flats met certain conditions they would not require a resource consent.
The flats would need to comply with “permitted standards” like maximum building coverage and minimum permeable surface requirements which will be needed to manage stormwater runoff and flooding risks.
The discussion document includes a range of options for requiring a setback, which is the amount of space between the flat and the boundary. One of the options is requiring no minimum setback, maximising the space someone could potentially build on.
Using an NES to achieve this means the rules can come into force quickly.
The second leg proposes that a new schedule is added to the Building Act to allow “simple standalone houses” up to 60sq m. The Government is consulting on the kinds of “conditions and criteria” these homes meet to be exempt from a building consent.
Acting Prime Minister Winston Peters and RMA Reform Minister Chris Bishop during the post-Cabinet press conference. Photo / Mark Mitchell
Housing Minister Chris Bishop said “removing the regulatory red tape will not only speed up the build process, it is also estimated to save up to $6500 just in the standard building and resource consenting fees per build, not to mention all the savings in time and resource”.
“There will be safeguards to ensure these granny flats continue to meet New Zealanders’ expectations for building performance and quality, and appropriately manage environmental effects. We want these to be safe, healthy and durable homes,” he said.
The options differ slightly from the coalition agreement which said granny flats should be able to be built “requiring only an engineer’s report”. Bishop said other structures did not need an engineer’s report prior to being built therefore pursuing this option would create more regulation when the Government’s desire was to reduce regulation.
“Engineers don’t currently produce reports that provide sign-off for an entire building. So we didn’t want to require a report that imposed that engineering services that otherwise would be required that would just add to cost. Instead, what we’ve settled on is requiring that the work be done by licensed building practitioner,” Bishop said.
Bishop said the Government wanted to make housing “more affordable for New Zealanders” and answered “yes” when asked if prices needed to fall.
“Average house prices to the average household income are too high by any objective measure. They are severely unaffordable by international standards,” he said.
Bishop said that house prices falling should not necessarily send a shiver up the spines of homeowners fearful of price drops.
“The flipside of house prices falling for people who own homes is that they become more affordable for people who don’t own homes. There is a whole generation of young New Zealanders who have been locked out of the housing market because average house prices are too high,” Bishop said.
“If we’re going to be a property-owning democracy, which [we] used to be, we need to make housing more affordable,” Bishop said.
Bishop’s comments today were rare for a Housing Minister at least considering the idea that a drop in house prices would not be a bad thing, even if that were not the Government’s actual goal.
Thomas Coughlan is deputy political editor and covers politics from Parliament. He has worked for the Herald since 2021 and has worked in the press gallery since 2018.
