Submissions now open on “Going for Housing Growth” initiatives

The government’s ‘Going for Housing Growth’ proposal is a step in the right direction towards freeing up development capacity for housing, but we’re looking to future announcements relating to infrastructure funding and incentives to be more effective at increasing housing supply. Our Senior Planner & Team Leader, Bryce Powell, explains.

The 'Going for Housing Growth' package is the fourth package in the changes to national RMA policy direction which also includes the Infrastructure and Development, Primary Sector and Freshwater packages and which we wrote about recently here, intended to comprise a series of “quick wins” to address perceived shortcomings in the current planning framework and ease restrictions on development and economic activity.

There are three pillars in the “Going for Housing Growth” programme:

Pillar 1: Freeing up land for urban development, including removing unnecessary planning barriers
Pillar 2: Improving infrastructure funding and financing to support urban growth
Pillar 3: Providing incentives for communities and councils to support growth

Pillars 1 and 2 are intended to work together by freeing up development capacity and making it easier to deliver infrastructure to support development.

Consultation

The government is calling for submissions on Pillars 1 and 2, with Pillar 3 proposals announced later this year.

The legislation that is needed to implement the Pillar 2 proposal (infrastructure funding and financing tools) will be introduced in September 2025 and is not yet open for consultation.

Consultation on Pillar 1 closes on 17 August 2025.

Pillar 1 key points

The Pillar 1 changes build on the National Policy Statement for Urban Development (NPS-UD), which requires territorial authorities to intensify around town centres and to provide for up to 30 years of growth. The government is also seeking feedback on how its ideas can be incorporated into the RMA reforms.

Three key proposals for Pillar 1 are:

1. Consideration of out-of-sequence growth

Current practice is to identify land for urban growth within a District Plan, but to require that land to be rezoned for urban purposes through a formal plan change process that, amongst other things, considers whether there is sufficient infrastructure in place for the development that is enabled by the new urban zone.

The government is seeking feedback on a proposal to make the land “development-ready” without requiring a formal plan change process by setting criteria or identifying infrastructure projects that need to be completed before urban development can proceed.

Linked to this, the government proposes to prohibit the application of a rural-urban boundary to contain urban areas, and changes to Policy 8 of the NPS-UD to provide a mechanism for territorial authorities to consider out-of-sequence or unanticipated development.

The approach acknowledges that not all infrastructure (such as parks, schools and other community infrastructure) is available at the time that land is rezoned for urban growth and that growth is often needed first to establish demand for infrastructure.

If designed well, these changes have the potential to increase housing supply and well-functioning urban environments. However, Pillar 1 does not address how three waters and roading infrastructure can be funded and delivered.

2. Intensification of existing urban areas

Current policy under the NPS-UD is for District Plans to provide for developments of “at least” six storeys in height within a walkable catchment of high-frequency transport corridors, and on the edge of city and metropolitan centres, in Tier 1 urban areas. The Government is concerned that some local authorities have instead set a six-storey height limit, when it may be more economical to build a taller building. The government is seeking feedback on this specific issue from the development community.

Changes are also proposed to offset lost housing capacity from land that cannot be intensified due to a natural hazard being present, or the area having less development potential because of its special character.

I believe flexibility sought by these proposed changes will, in principle, achieve a more balanced growth policy. The changes may lead to more apartment buildings, which will promote lifestyle choice.

I also question whether the Government will prioritise intensification over developing farmland on the urban fringes.

3. Greater ability to provide for mixed-use developments

The Government is seeking feedback on proposals to make it easier to provide for mixed-use developments and/or non-residential activities within residential neighbourhoods.

While it supports sound planning practice, there must be adequate regulations in place to manage the adverse effects/externalities of the activities on the community. It’s what’s needed to provide for a walkable and liveable community and to capitalise on investments in walking and cycling infrastructure.

Pillar 2 key points

The Government has released fact sheets on a proposal to replace development contributions with a development levy system and / or targeted rates in high-growth areas.

The purpose of shifting from development contributions to development levies is to ensure that infrastructure providers charge developers a proportionate amount of the total cost per capital expenditure necessary to service growth over the long term.

The Government wants to make it possible to pass on the cost of developing infrastructure onto developers who benefit from that infrastructure later, so that these costs are spread more equitably.

Targeted rates could be applied together with development levies where the infrastructure benefits existing residents and provides for growth. They can also apply to new developments as an alternative to development levies.

My comments

The proposed Pillar 1 and 2 changes are a positive step towards increasing housing supply and freeing up land for development. However, no matter what changes are made to the planning system, infrastructure needed to support growth still needs to be funded. In some locations throughout the country, it may make sense for the cost of growth to be passed onto a developer, while in other locations, it may be more difficult to absorb or pass on in the sale price.

There have been many cases where land use zoning has enabled development, but the supporting infrastructure cannot be funded, even if these costs are shared through a negotiated development agreement.

There are many more locations across the country where councils propose large development contributions to service development ahead of when the supporting infrastructure would have otherwise been funded. In some cases, the development contributions that are being charged make the development uneconomic or financially too risky to pursue, and the ‘development-ready’ land has sat vacant. It will be interesting to see how costs of growth are shared through development levies and targeted rates, and what role incentives will play in supporting growth.

It will also be interesting to see how infrastructure works are funded and implemented within existing urban areas. Upgrading infrastructure within an existing urban area, where landholdings are small, occupied, and held in separate ownership, requires a level of planning, design, and coordination quite different to what is required for greenfield development at the urban edge. Consenting pathways and compulsory land acquisition powers available to the Government are also not available to private developers.

Contact us

To discuss further and for support in preparing your submission to the ministry, please reach out to Bryce Powell