As part of the Government’s wider package of work to streamline the building consent system and address the housing crisis, it has recently released a Discussion Document on proposed new measures to make it easier to build small, self-contained detached houses, commonly known as ‘granny flats’ or ‘minor residential units’ (MRUs). 

Changes are proposed to both the Building Act 2004 (Building Act) and the Resource Management Act 1991 (RMA) regimes, and will likely comprise:

• A new Schedule in the Building Act to provide a new exemption to building consent requirements (but subject to compliance with additional criteria); and
• New National Environmental Standards (‘NES’) under the RMA that will make MRUs a permitted activity provided standard requirements are met. 

What kinds of dwellings could be built? 

The policy intention is to support a range of people and circumstances, from young people through to seniors, by providing a more affordable housing choice. The proposals are likely to apply to small (60m2 or less), detached, self-contained, single storey houses for residential use in circumstances where there is already a principal residence on-site and the two will be held in common ownership. However, feedback is sought on whether the proposals should also apply to accessory buildings, extensions and attached ‘granny flats’ as well. 

The discussion document notes that most district plans already allow MRUs and other structures under 60 m² in rural and residential zones without a resource consent, subject to permitted activity standards (e.g. in relation to building position, height, and size). One of the aims of the proposal is to provide consistency across the country by requiring all councils to permit MRUs without the need for a resource consent and subject to the same set of standards. 

Building Act proposal

While the discussion document identifies a number of mechanisms to dispense with the building consent requirement for MRUs, the Government’s preferred option is to establish a new Schedule in the Building Act to provide an exemption for simple standalone dwellings up to 60 m². Additional criteria would be added to recognise the increased risk of these buildings compared to building work that is currently exempt under Schedule 1 (such as a single-storey detached building not exceeding 10 m² in floor area). 

Compared to other Schedule 1 exempt works, an ancillary flat would impose increased demand on council infrastructure including drinking water, wastewater, stormwater, roading and community facilities. Resource or building consents are a trigger for councils to charge development contributions, which help pay for the increased demand the new house has on infrastructure. In the absence of such consents, the Government is still considering how this increased demand on infrastructure will be financed, promising more information once decisions are made. 

Minimum requirements for Building Act exemption

In recognition of the increased health and safety risks that come when a building is not checked by a regulator, the Government proposes including additional criteria in the new Schedule to the Building Act. These criteria would require the small house to be built by “trusted workers, to a simple straightforward design, and be notified to councils.” Landowners would be required to notify the council when work is planned and completed. 

To reduce time-to-build and additional cost, an engineer’s report would not be required. However, in an effort to ensure these are still “good homes”, the Government’s proposal includes measures to mitigate safety and environmental concerns, such as:

• The building must be designed and built to comply with the Building Code;
• The exemption only applies to a new building, not the modification or alteration of an existing building;
• The building must be no more than 60 m² and only one storey;
• The building must be designed and built in accordance with certain Acceptable Solutions and in certain wind zones only, unless designed to MultiProof or designed/built under BuiltReady, and used within the scope they were approved for;
• Any design or building work not covered by MultiProof or BuiltReady must be done (or supervised) by a Licensed Building Practitioner working within their scope of competency;
• All plumbing and drainlaying must be done by an appropriately licensed person under the Plumbers, Gasfitters and Drainlayers Act 2006; and
• Where network utility operator services are not available the installation or alteration of an onsite wastewater treatment, onsite stormwater disposal or onsite water supply system would require a building consent (exclusively for these systems).

Permitted activity standards under the RMA

The Discussion Document seeks feedback on several options for permitted activity standards in relation to setbacks, permeable surface area, and building coverage under the new NES. Notably:

• For residential zones, the options for minimum setbacks range from 2m from front boundary and 1.5m from side and rear boundaries to no minimum front, side or rear boundary setbacks;
• The options for minimum permeable surface are 20% or 30% of the site; and
• The options for maximum building coverage for MRUs and principal residential units collectively are 50%, 60%, and 70%, with no maximum building coverage in rural zones.

No building height and height in relation to boundary standards are proposed to be included in the NES. However, in due course it will be necessary to consider alignment between Building Act and RMA requirements, given the Building Act options include either limits on the height of the building or a two metre setback distance.

What the NES will not cover

There will be some RMA matters that fall outside of the scope of this NES where other rules or sections of the RMA apply and may still trigger the need for a resource consent. So in other words, meeting the requirements of the NES will not be a guarantee that the MRU can proceed without a resource consent. 

For example, the Discussion Document lists the following matters:

• Subdivision: if a landowner wants to subdivide the MRU after it has been developed, they will need to meet the subdivision requirements set out in the district plan.
• Regional plan rules: Resource consents may be required on a regional level, particularly in rural areas where an on-site wastewater system may be required. 
• The specific use of the MRUs: Landowners will still need to abide by existing plan provisions if they wish to change the activity that occurs within the MRU, such as temporary accommodation (Airbnb etc), a home business, or childcare services.
• ‘Matters of national importance’ (RMA section 6): The Discussion Document states that it is not proposed to “override” overlay provisions in district plans that relate to ‘section 6 matters’ (e.g. biodiversity protection, outstanding landscapes, heritage overlays, and so on). 

It also appears that associated activities such as earthworks or vegetation clearance (if/where relevant) would also potentially trigger consent requirements in the usual way. 

Reactions and comment

While the Labour party has shown support for the proposal, housing spokesperson Kieran McAnulty has expressed concern that the flats will be “jammed into backyards too close to the main building without enough room for stormwater to escape.” If the minimum options for setback and permeable surface area and maximum option for building coverage are adopted, this worry could become a real risk.

In our view the proposals are likely to be a small but meaningful step towards removing unnecessary consenting requirements and providing greater certainty and consistency around where and how housing can be developed. However, the benefits in that regard may be diluted by the fact that it will still be necessary to check for district plan overlays and in some cases regional plan restrictions as well.  Some care will be needed in drafting the NES to ensure this is clearly spelled out, and it is clear which overlays apply and which do not (e.g. heritage vs biodiversity vs urban design standards). 

On the other hand, it is notable that the matters listed as out of scope of the NES do not including anything in relation to the potential ‘reverse sensitivity’ effects of new MRUs establishing next to major infrastructure (such as airports) or more intensive land uses (such as quarries). There may be some instances where it is appropriate for infrastructure corridor setbacks, noise contours and so on to still apply as well, and we suggest this should be another area of focus in refining the policy proposals. 

Submissions are now open and close 12 August 2024.

This article was written with the assistance of Samantha Fowler, a Solicitor in the Wellington Environment and Planning team.