The couple appealed the council's decision to decline the resource consent to the Environment Court which approved the project with a number of conditions.
The court has directed WDC to finalise final conditions of consent and the proposed site plan within 20 working days from December 16, 2016.
"I am happy. We waited nearly two years. Taurikura and Whangarei Heads in general really needs some sort of other facilities like a cafe and that's what we're all about," Mr Engebretsen said.
He plans to convert the three bedrooms into a general store, cafe, and the post office while the couple will occupy the sleepout.
But the conversion will start after final orders are made by the Environment Court next month.
The previous premises Mr Engebretsen and Ms Song leased at 2311 Whangarei Heads Rd had traffic and parking constraints.
The owners of a seaside holiday property running along the southern boundary of the proposed store site are among those opposed to the project.
They said the proposed licensed indoor-outdoor cafe would have a major impact on their privacy as it would overlook their backyard.
Noise would likely exceed the district plan's maximum allowance for the area and that rubbish and food preparation odour could be an issue, they complained.
Neighbours Glen and Noelene MacDonald said the existing store at 2311 Whangarei Heads Rd was sufficient to meet the needs of the area.