Inside the latest changes to planning regulations
New Zealand’s new planning legislation could be a game changer for property prices, especially in Auckland and Wellington.
The Resource Management (Enabling Housing Supply and Other Matters) Amendment Act 2021, passed just before Christmas, radically altered planning requirements in New Zealand by increasing the number of storeys that can be constructed on a family home, offering a potential solution to the affordability crisis that many young people are facing.
The act was passed with bipartisan support, reflecting the acknowledgment from both sides of the political spectrum that the supply of housing in New Zealand, especially in large cities, has become a major issue.
“New Zealand has been struggling with this for the last 10 years, and, increasingly, it’s become a political issue,” said Tom Forrest, a Kiwi-born, Australia-based expert on urban planning who heads up Urban Taskforce, one of the largest organisations for developers in New South Wales.
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“So much so that both sides of Parliament, both the National Party and the Labour Party, came together to pass a new law to increase density of urban dwellings
“They have a category called the ‘family home’, which typically refers to a single-family dwelling. They’ve passed a law that allows, as a matter of right, for any family dwelling to be increased in height from one storey to three storeys.
“That effectively increases the yield on land use by 300%: it increases it by two storeys on any single floor.”
The law could set an interesting precedent for housing supply well beyond New Zealand, said Forrest.
“For us in Sydney, where we aren’t affected by earthquakes like they are in New Zealand, similarly you could take any three-storey apartment and as a matter of right make it 10 storeys – that’s the equivalent of what they’ve done,” he said.
“The NZ authorities have seen that their land mass is running out, and because the infrastructure demands are too great to keep going with urban sprawl, they’ve seen that going tall is a way to solve the problem.
“They’ve done it with the support of both sides of the Parliament, and that’s what is important. What frustrates decision making in Australia is the fear that NIMBYs will come in and you get hit politically as a result.
“By having both sides of the Parliament recognise that housing supply and housing affordability is a major issue, they’ve effectively solved that. The problem won’t be solved immediately, but having a system that facilitates the growth in supply is a huge lesson that we need to take on here in Australia.”
