New planning system
2027
RMA replacement goes live
Government and planning policy
The rules that decide what can be built, where, and how cheaply are being rewritten. We track the reforms shaping apartments, townhouses and intensification, and translate them into what they mean for a development case.
Reviewed June 2026 · Reform programme ongoing
Auckland capacity
1.6m
Reduced from about 2m homes
Zoned capacity rule
30yr
Up from a 3 year requirement
Granny flat consent
Exempt
Up to 70 square metres
The reform context
New Zealand is in the middle of its most significant planning overhaul in a generation. The Government's position is that the Resource Management Act 1991 has constrained the supply of developable land and is a central cause of housing unaffordability. Its response runs on two tracks: a near term programme called Going for Housing Growth, and a wholesale replacement of the RMA with a new planning system expected to be operational in 2027.
For anyone making a development or investment decision, the practical effect is a moving target. The zoning, consent and density settings that determine a project's yield are changing. In some places they are loosening sharply, and in others, notably parts of Auckland, they are being pulled back. Below we set out the pieces that matter most, and the implication of each. You can follow the programme directly at HUD and the Beehive.
The early effect is already visible in the construction data. New dwellings consented rose 16 percent in the year to April 2026, to 39,087, and the growth is concentrated in exactly the higher density formats these reforms are designed to enable. Townhouses, flats and units rose 19 percent and apartments rose 27 percent, according to Stats NZ. Policy is beginning to translate into supply, which is one reason prices have stayed flat even as borrowing costs have eased.
Going for Housing Growth: three pillars.
The programme is structured to attack what the Government identifies as the root causes of the supply shortage.
Pillar 01
Free up land
Remove planning barriers and require councils to zone enough developable land, both up through intensification and out at the urban fringe.
Pillar 02
Fund infrastructure
Reform the Infrastructure Funding and Financing Act so growth infrastructure can be paid for without stalling projects.
Pillar 03
Reward growth
Pay councils for the homes they consent through an Incentives for Growth Fund, with first payments scheduled for April 2027.
The policies that move a development case.
Each item below is summarised in plain language, with the practical implication for developers, investors and funders flagged separately. Every source opens in a new tab.
P 01
Replacing the RMA with a new planning system
Bills before Parliament, system live around 2027
The RMA is being replaced by two new statutes, a Planning Act and a Natural Environment Act. The stated aim is radical standardisation. New Zealand currently has more than 1,100 different zones, and the new system intends to collapse these into a much smaller set of standard zones with consistent national rules for height, site coverage and daylight. The promise to developers is that the same building design could be used anywhere in the country, with fewer activities needing consent at all.
What this means Greater design re use and consenting certainty would lower holding costs and de risk timelines. The transition itself, running through to 2027, creates a window of uncertainty that any feasibility should price in.
Source: Ministry for the Environment and the Beehive, 2025 to 2026.
P 02
Intensification and the MDRS becoming optional
NPS-UD strengthened, MDRS optional
The Medium Density Residential Standards, the three homes of three storeys default that applied across most urban sites, are being made optional for councils. In their place, intensification will be driven through a strengthened National Policy Statement on Urban Development, with density required around transport corridors and centres. Councils will also be required to enable small to mid scale mixed use such as cafes, retail and offices in higher density areas.
What this means Where intensification rights are granted, they are valuable and should be reflected in land value. Where councils opt out of the MDRS, sites that looked developable on paper may not be. Site by site verification matters more than ever.
Source: HUD and the Beehive, Going for Housing Growth decisions.
P 03
Apartments: minimum floor area and balcony rules abolished
Confirmed, national direction
Council imposed minimum floor areas and balcony requirements for apartments are being removed. The Government cites 2015 Auckland evidence that balcony size requirements alone added roughly 40,000 to 70,000 dollars to the cost of an apartment. Removing these rules is intended to enable smaller, lower cost apartment formats.
What this means The viable apartment product set widens. Compact typologies that were previously not compliant become feasible, which changes target market and yield assumptions. Demand evidence for smaller formats becomes the key question.
Source: Beehive, Going for Housing Growth stage one.
P 04
Townhouses: the supply legacy of the MDRS
Market in adjustment
The earlier intensification settings unleashed a wave of townhouse construction. There are now around 242,000 townhouses nationally, roughly 48,000 more than eight years ago, and that pipeline is actively holding prices down in Auckland and Wellington. With supply elevated, a meaningful share of recently built townhouses have resold at a loss.
What this means For developers, townhouse oversupply in some catchments compresses margins and absorption. For investors and first home buyers, it is a buyer's market. New townhouse feasibilities need conservative absorption and pricing assumptions backed by local evidence.
Source: Cotality commentary, 2026, and PRI analysis.
P 05
Auckland Plan Change 120
Capacity reduced to 1.6 million homes
Auckland's intensification plan, the successor to Plan Change 78, is being recalibrated. The Government has moved to reduce the minimum housing capacity Auckland must zone for, from just over 2 million homes down to 1.6 million, while strengthening density around City Rail Link stations. The council has also been consulting on scaling back the most contested intensification provisions.
What this means Upzoning is being concentrated around rapid transit nodes rather than spread city wide. Land near City Rail Link stations carries enhanced development potential, and blanket assumptions of city wide intensification no longer hold.
Source: Beehive and Auckland Council, 2026.
P 06
Granny flats and minor dwellings, now consent free
In force
Standalone minor dwellings, often called granny flats, of up to 70 square metres can now be built without building or resource consent, subject to standards. The exemption is being expanded to support faster construction and off site building methods.
What this means A low friction way to add density and rental yield on an existing section. This is relevant to infill strategies, holding income plays and value add for investors.
Source: Beehive, granny flat consent exemption, 2026.
P 07
Housing Growth Targets and 30 years of zoned capacity
Tier 1 and Tier 2 councils
Tier 1 and Tier 2 councils must live zone feasible development capacity for at least 30 years of demand at any one time, a substantial step up from the previous three year requirement, and must show that urban land price indicators do not deteriorate over time.
What this means Over the medium term this should expand developable land supply and ease the land price pressure that sits at the front of every feasibility. The benefit accrues gradually as councils re plan.
Source: HUD and Beehive, Going for Housing Growth.
P 08
Infrastructure Funding and Financing reform
Amendment Bill before Parliament
The Infrastructure Funding and Financing Act is being broadened so levies can be used in a wider range of circumstances, with a streamlined approvals process aimed particularly at developer led projects.
What this means New routes to fund the trunk infrastructure that often gates greenfield and brownfield projects, potentially unlocking sites whose economics previously failed on infrastructure cost alone.
Source: HUD, IFF Amendment Bill, 2025 to 2026.
Policy into a development case
What is legal to build is changing faster than most feasibilities assume.
We translate the live policy position for a specific site into what it means for yield, typology and consenting risk, and we document it to the standard a council hearing or a funder will scrutinise. Policy is a moving target, so we date and source every position.
The live planning position for your site
Yield and typology implications spelt out
Dated and sourced for a hearing or a funder
Sources and references
- HUD, Going for Housing Growth programme
- Beehive housing and RMA reform releases
- Ministry for the Environment, new planning system factsheets
- Auckland Council, Plan Change 120 consultation materials
- Cotality, townhouse supply commentary, 2026
Policy summaries reflect PRI's reading of public sources as at June 2026 and are general information, not legal or planning advice. The reform programme is ongoing and detail may change through the select committee and plan change processes. Verify the current position for any specific site before relying on it.