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

In the new resource management system, councils will be required to apply nationally standardised zones. Councils may be able to modify nationally standardised zones where they consider that intensification is not appropriate by applying overlays and completing a justification report.

This approach is similar to the use of qualifying matters in the current system. As noted above, some councils have made relatively broad use of unlisted qualifying matters to date (such as to protect special character). Cabinet has agreed to require councils to offset the loss of development capacity through use of an unlisted qualifying matter by a corresponding increase in development capacity elsewhere.

We’re considering whether how this approach could translate to the new resource management system. Our initial view is that there is still a case for disincentivising councils from departing from specified standardised zones or specified minimum heights, more than is necessary to accommodate particular resource management issues (such as the management of natural hazards) and we’re seeking views on whether offsetting any lost capacity into an equivalent area is an appropriate way to achieve this.

Assuming that offsetting of development capacity is provided for in the new system, one option would be to require capacity lost as a result of departure from standardised zones and overlays to be redistributed within a different part of the same intensification area or catchment. This could be done by requiring a more intensive standardised zone to be used. Alternatively, councils could be required to redistribute capacity to an area with an equivalent land value per m² (plus or minus 10 percent). This is on the basis that land value is a proxy for areas with similar demand and development feasibility, and therefore likely to support similar types of development outcomes.