The planned sale of a plot of church land in Flat Bush, South Auckland, is to provide up to 18 new homes on the edge of a 130-year-old cemetery where many of the city's earliest settlers are buried.

The 3200sq m block of residential land at 169 Chapel Rd is the site of the former Flat Bush Methodist Church, which closed in the 1960s because its congregation was dwindling.

The church was later moved off-site and sold to a private owner, who transformed it into a home in a central city suburb.

The cemetery was located behind the former church land. The earliest grave on the 800sq m plot belonged to Horace David Whitten, who died from blood poisoning at age 6 on July 12, 1886.

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Following the church's closure, the entire 4000sq m block was classified as a cemetery and closed.

For the better half of a century it lay dormant, used as little more than a paddock for the occasional farm animal.

Despite not having to pay rates for the cemetery land, the church still had to pay a fair amount in maintenance costs - cutting grass, trimming trees and general upkeep.

The chief executive of Methodist Church Connexional Property, Greg Wright, said the church felt the land was a valuable asset that could be put to better use.

While only the back corner had ever been used for burials, the whole block was still classed as a cemetery and therefore the land could not be developed or sold.

"The land had lain fallow with just a couple of horses and sheep grazing on it," he said.

To make it available for development, the church had to prove there were no bodies outside of the cemetery area.

Mr Wright said it had taken about eight years, but plans were finally on track to put the block of land up for sale at the end of this month.

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Howick Pakuranga Methodist Parish property convener Brian Jones has been looking after the land for several years and is pleased that things are finally coming together.

"It took an act of Parliament to separate the two pieces of land," he said.

The land the cemetery was on - about 1000sq m - would still be owned and maintained by the church.

The plan was for a developer to buy the newly freed-up land and to subdivide it into 16-18 housing lots.

Church records show it was bought back in 1882 for only 20 ($40), which, according to the Reserve Bank's inflation calculator, is equivalent to $3361 today.

While Mr Wright couldn't say how much each new home was likely to cost, he said the density of the area suggested these would be in the affordable bracket.

"It's a parcel of land that will be able to provide houses in an area that is so desperately in need of it," he said.

According to Barfoot & Thompson, the average sale price of a house in the Howick-Pakuranga area last month was $1,021,310.