Going for Housing Growth: Providing for urban development in the new resource management system

Current status and case for change

Policy 3 of the NPS-UD directs Tier 1 councils to enable more density in central and easily accessible areas and in places of high demand. It requires councils to enable:

1. in city centre zones: building heights and density to realise as much development capacity as possible (Policy 3(a))
2. in metropolitan centre zones (Policy 3(b)), and within a walkable catchment of city and metropolitan centre zones, and existing and planned rapid transit stops (Policy 3(c)): building heights of at least 6 storeys
3. within and adjacent to neighbourhood, local and town centre zones: building heights and density commensurate with the level of commercial activity and community services (Policy 3(d)).

The NPS-UD enables councils to use ‘qualifying matters’ to avoid or limit intensification in areas where it would be inappropriate. Some qualifying matters are specifically listed or referenced in the NPS-UD (such as management of natural hazards and the provision of open space for public use). There is also provision for councils to avoid intensification due to other ‘unlisted’ qualifying matters.

Several issues have arisen with the implementation of the NPS-UD intensification provisions. These include:

1. discretion provided to councils over matters such as what constitutes a rapid transit service or a ‘walkable’ catchment has added time, cost and uncertainty to the plan change process. Discretion can also undermine the intent behind the intensification policies by reducing the areas the policies apply to.
2. ‘unlisted’ qualifying matters being applied more extensively than anticipated (such as in relation to ‘special character’) and limiting development capacity in areas where high density developments are most likely to be viable. In some cases, we do not consider that councils have met the requirements to justify the use of these unlisted qualifying matters.

In addition, with the MDRS not forming part of the future system, there are opportunities to provide for intensification in areas of high demand, with good accessibility or both, while still providing councils with more discretion about how intensification is enabled than under the MDRS.

Summary of proposals

In July 2024, Cabinet agreed to progress the following changes to the NPS-UD:

1. Apply the original scope of Policy 3(d) of the NPS-UD, which requires enabling building heights and densities commensurate with the greater of accessibility and demand, across the entirety of urban environments.       
2. Amend the definition of rapid transit service by specifically listing existing rapid transit services.
3. Add new direction to require councils to intensify around two new categories of key transit corridors, in addition to rapid transit.
4. Set minimum walking catchment sizes around city centre zones, metropolitan centre zones, rapid transit stops and key transit corridors.
5. Clarify that decision-makers, independent hearings panels and any other people making recommendations on plans must explicitly consider the requirements related to qualifying matters and reflect this in analysis documents that support recommendations or decisions.
6. Require that the loss of development capacity through the use of an unlisted qualifying matter be offset in an equivalent area.

As with other decisions in relation to Pillar 1, these decisions were made in the context of the current system and will need to be adapted to the future system.

Next, we set out specific matters relating to intensification on which we’re seeking feedback.