Exemptions for small stand-alone dwellings

As of 15 January this year, building small stand-alone dwellings, also known as granny flats, became much simpler as changes to the Building Act 2004 and National Direction under the Resource Management Act 1991 came into force. The changes enable new single story, stand-alone dwellings of up to 70 square metres to be constructed without needing a building or resource consent; given certain conditions are met.

The purpose of these changes is to increase the supply of small houses by removing what are considered unnecessary regulatory barriers. Allowing these dwellings to be built without requiring a building or resource consent will reduce the complexity, time and cost of consenting these simple dwellings, resulting in more affordable and diverse housing options. Particularly in sight are families with multigenerational living in mind, people with disabilities, young adults and workers in rural areas.

To qualify for the building consent exemption, certain conditions must be met, including:
• The dwelling must be simple in design, for example the roof and frame constructed with lightweight materials and have simple plumbing and drainage systems.
• The building must comply with the Building Code.
• Building work must be carried out by authorised building professionals.
• The local council must be notified before the build commences and on completion.

It is also a requirement that before building work can commence, a Project Information Memorandum (PIM) must be obtained from the relevant territorial authority (e.g. local council). In issuing a PIM, a territorial authority will consider whether a development contribution is payable. This one-off fee recognises the public infrastructure (roads, water, sewage) funding required to support such developments. The PIM will also identify whether there are additional conditions that may impact the design, including natural hazards and bylaws.

Alongside amendments to the Building Act, the National Environmental Standards for Detached Minor Residential Units (NES-DMRU) was introduced to amend the Resource Management Act to remove the need for resource consents for granny flats. A DMRU is defined as a self-contained residential unit that is additional to, and held in common ownership with, the principal residential unit on the same site.

The NES-DMRU allows for one DMRU per site and applies in residential, rural, mixed-use and Māori-purpose zones, where specified permitted activity standards are met. In addition to the floor area being no more than 70 square metres, the permitted activity standards set out the maximum building coverage for a site and the distance from the principal residential unit and boundaries. Other existing rules in local council district plans or unitary plans will still apply, for example rules on subdividing land, protecting natural or cultural sites, and health and safety standards that also apply to the principal residential unit.

Exempting granny flats from building and resource consenting requirements is expected to shave off $5,600 in direct costs and speed up the process by up to 14 weeks. It is also projected to boost productivity in the building sector, with around 13,000 more granny flats expected to be built over the next ten years.

Further information can be found on the Ministry of Business, Innovation and Employment and Ministry for the Environment websites.