When The Rule Book Changes
Investors should be aware of recent adjustments in subdivision legislation, writes Alice Balme and Imogen Edwards, of Wynn Williams.
31 May 2022
In recent years there has been a shift in the policy framework around residential development. Changes in this space were intended to make the process for subdividing and building residential dwellings consistent across the country.
The National Policy Statement on Urban Development Capacity 2016 was the first “national direction” around urban development and shone a spotlight on those urban centres where growth was at its highest: Auckland, Tauranga, Wellington and Christchurch. This policy statement was swiftly replaced by the National Policy Statement on Urban Development 2020 following a change of government.
Councils in these areas were required to respond quickly; identifying land for residential (and business) development that could be supported with the necessary infrastructure, not just in the short to medium term but in the long term.
As if this wasn’t enough, the government then introduced the Resource Management (Enabling Housing Supply and Other Matters) Amendment Act 2021, an amendment to the Resource Management Act 1991 (RMA). The intention was to remove perceived development barriers from the RMA (and local planning frameworks) to accelerate the intensification of residential development. What does this mean on a practical level? Well, quite a lot. If you are considering subdividing your property in the future, take note.
The Urban Space
A key driver behind the changes is a desire to standardise the approach to residential development in New Zealand as much as possible. Standardisation is a common theme that can be seen in several changes in the RMA landscape recently, but perhaps none so obvious as in the urban development space.
The days of having a multitude of planning documents regulating urban development that differ from district to district are numbered. We will soon see standardised objectives, policies and standards (referred to as the Medium Density Residential Standards) applying to certain residential zones across the country. Large-lot residential areas, areas subject to natural hazards and areas with heritage features will be the only exceptions where the standards will not apply. You may have already seen councils consulting on plan changes that will see the Medium Density Residential Standards introduced in residential zones; at the same time identifying those areas subject to natural hazards and heritage features exempt from the standards. Councils are required to notify plan changes that give effect to the RMA changes in this respect by August 20.
Once incorporated into planning frameworks nationwide, the new standards will create a consistent approach to residential development; doing away with the need to obtain resource consent for the physical development itself (provided the development complies with the Medium Density Residential Standards).
Subdivision must now be provided for as a controlled activity. While consent is still required for the activity of subdividing a property, the relevant local authority is required to grant the application if it complies with the relevant requirements or conditions. And in certain circumstances, restrictions relating to minimum lot size, shape size, or other size-related subdivision requirements will be removed.
New density standards mean there can be up to three residential units per site, with buildings up to three storeys in height permitted. Recession plane restrictions are far more permissive under the standards. Buildings must not project beyond a 60 degree recession plane measured from a point 4m vertically above ground level along all boundaries. Setbacks, building coverage, outdoor space and landscaped area requirements are also standardised.
Restrictions on notification introduced with this legislation significantly limit public voice in the built environment. An application must not be publicly notified if it is for a development of one, two or three residential units and does not comply with one or more of the density standards. Moreover, an application for four or more residential units that complies in all other respects with the density standards must not be publicly or limited notified.
The standards are designed to facilitate rapid intensification, in a uniform manner, and negate the need to obtain resource consents as much as possible. Where resource consent is required, the ability of nearby neighbours to participate through either public or limited notification is curtailed.
This uniform, standardised approach to development will likely be welcome news for developers. Perhaps not so much for those living next door