Will Government’s New Building Law Create More Affordable Housing in New Zealand?

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  • The New Zealand government introduces first set of reforms in the Building Act.
  • Changes passed in the Parliament.
  • Aims to boost housing supply for first home buyers.

With a view to give a boost to building activity and housing supply, the New Zealand government on Thursday passed a series of new building laws, which will support the housing supply and affordability for the first home buyers.

The changes that were passed in the Parliament represent the first set of reforms to the Building Act, which aims to increase the efficiency and quality of the building work.

According to the Minister for Building and Construction, Poto Williams, the government was committed to bridge the supply-side gap in the housing and provide affordable, quick and efficient housing. These new laws deliver on these objectives by providing for modern technology such as offsite manufacturing.

Also Read: Would Budget 2021 Restore Vigour In New Zealand Property Market?

It may be recalled that the rise in housing prices was also led by the supply-side lag. The demand for houses was more than the supply. Even in the Budget for the year, the NZ government had announced that the supply side reforms were forthcoming.

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New Reforms

This new scheme called the modular component manufacturers will allow offsite building manufactures to sign off their own designs and construction. This is being done with a view to speed up the consenting process.

Most of the consenting processes will make innovation and modern technology easier and user friendly.
Also Read: Housing Crisis Deepens in New Zealand

Other reforms include a public disclosure by the manufacturers and the importers on the building products and their uses. This way the designers and builders will choose the right products and also be accountable for what products and materials they use.

This new requirement mandated by the new law will ensure safer and more durable buildings.

The minister said that that was meant to give the first home buyers greater confidence in the building products they use, and being transparent about the product information would benefit the entire building system.

Also, the reforms also include a number of changes to the CodeMark product. The new laws announced Thursday also include a range of changes to the CodeMark product certification, which specify penalties for existing offences.

All these changes to the building Act with be applicable immediately.

Building activity declines during COVID-19 pandemic

During the COVID-19 pandemic, new homes building projects had suffered due to disruptions in supply chains. According to Stats NZ, a survey of new building projects has revealed that half of the building projects reported moderate to severe impact of the pandemic.

Also Read: Why NZ House Buying Spree Refuses to Die Down

A sample of 4,500 builders, developers and owners was taken to understand the COVID-19’s impact on building projects. A majority of building project builders said that COVID-19-related impact on the supply of materials and equipment was felt in Auckland. This was not the case outside of Auckland but in other parts, the building activity was influenced by other factors such as cashflows, labour, and costs etc.

The Ministry of Business, Innovation and Employment, is now consulting with the building sector to come out with new regulations on other parts of the Bill.



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