The number of consents for multi-unit residential dwellings in the Bay of Plenty has skyrocketed by 196 per cent in the year to November.
One property expert expects the trend to continue and Rotorua’s head of district development said property owners were keen to put a second dwelling on existing sites.
Stats NZ figures from November 2022 show consents in the Bay of Plenty for multi-unit dwellings were 74 compared to just 25 in November 2021. The number of house consents over the same period fell from 195 to 94.
Rotorua Lakes Council consented to none in November 2021 but consented to eight in November last year, made up of four building consents at two units per application, all in the Pukehangi Rd area.
Property services company Veros’ managing director Morgan Jones said the region was “on the cusp of pretty, big, significant change”.
“That proportion of multi-unit dwellings will continue to grow in time. It’s a trend that’s gathering momentum and is here to stay.”
He said Rotorua Lakes Council was doing “a whole lot” to try to open up land for more housing after a decade of “little to no growth and housing supply”.
That coincided with central government changes for many local authorities - called Medium Density Residential Standards, a component of Plan Change 9 legislation - that allow three dwellings of up to three storeys in height without resource consent on most residential sections, provided certain standards are met.
However, Jones said the biggest issue facing multi-unit dwelling development was “the worst market conditions” for a decade.
“We have the right planning framework, infrastructure planning and so on in place largely across the city. That happens to have coincided with the worst-market conditions that we’ve had for delivering new housing in probably 10 years.
“We’ve got a whole lot of the pieces of the puzzle in place but then we’ve got a market where development finances are hard, mortgage rates have gone up, construction prices, materials and labour force have gone up in a really constrained market.
“The actual ability to deliver new housing is really challenging.”
In Tauranga, eight building consents were issued for 74 dwellings in November 2022 and Jones thought Rotorua’s property market would benefit from buyers who couldn’t afford or find property in Tauranga.
“[Tauranga’s] got a constrained market here to provide new housing, but a lot of people still want to live in the Bay.
“The reality is [Tauranga] is in a constrained land environment [and] if you want a quarter-acre section with a standalone house, you actually need these days to look elsewhere and that’s where you can pick up a different housing typology that’s probably more traditional for a different price point as well in those different markets.
“Rotorua is one of those areas where the market’s still providing the standalone on medium to large sections that you probably can’t get at a comparable price point in Tauranga.”
The new rules would help reduce build times, reduce consenting costs and improve opportunities for development and infill housing, Rotorua Lakes Council previously said.
The aim was to tackle the city’s chronic housing supply shortage and would allow for building up, rather than out.
Rotorua-based Veros development manager Paul Spurdle said a substantial part of the changes were about removing the requirement for resource consents and the need for neighbours’ approvals and the ability of nimbyism (not in my backyard).
In his view, overall the changes were positive and would lead to more efficient use of land.
“When you intensify your city, you get those good outcomes of enhanced walkability, cycling, and more efficient use of infrastructure that’s already in the ground, roads that are already built, existing parks, and over time it’s undoubtedly going to lead to some good outcomes.
“The great thing about going up is you get more concentration of people living in one area. You get better value for money out of your existing infrastructure, more use of existing commercial areas and overall increased vibrancy.”
University of Waikato environmental planning professor Iain White said traditionally Kiwis have not had to make “hard choices” about housing and space, except for the likes of Wellington with its hilly typography and coast.
One of the big reasons New Zealand cities grew outwards rather than up was because they expanded around the same time the car became popular whereas denser cities overseas started pre-car.
He thought the consenting figures were “really positive”, could be great for the city centre and more multi-unit dwellings would diversify the housing stock.
“We have a lot of the same kind of house in New Zealand – having a diverse housing stock is good because it allows people to have different styles of living at different times of their life.
“If you’re in your twenties you might want to live in a townhouse in the city centre, if you’re bringing up a family you might want to be elsewhere and if you’ve sold up and want low maintenance you might want an apartment in the city.
“[More] people living within walking distance of the city centre stimulates the local economy when you get more hospitality, more retail, you see land values rise. One of the best things you can do to economically regenerate a city centre is to have more people living closer to it.”
In a statement, Rotorua Lakes Council deputy chief executive of district development Jean-Paul Gaston said since coming into effect, Medium Density Residential Standards had created “increased interest” from owners using the standards to place a second dwelling on an existing property, rather than three-story developments.
“The intention of the Medium Density Residential Standards is to provide greater certainty and enable greater density of homes, provided a series of standards/rules are met.
“These standards include outdoor areas, distance to boundary and height up to three storeys. If the standards are met resource consent is not required.”
Correction & clarification
An earlier version of this article contained incorrect references to Plan Change 9 when it should have referred to Medium Density Residential Standards, which are a component of Plan Change 9. The article has also been clarified to make clear that three dwellings up to three storeys high can be built on most residential properties without requiring resource consent, provided certain standards are met. It has also been updated to make clear the statement that quotes Rotorua Lakes Council on the changes reducing building times and consenting costs and improving opportunities for development and infill housing was made earlier, not the week before the article was published.
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