The New Zealand government has passed the Building and Construction (Small Stand-alone Dwellings) Amendment Bill, which will make it easier, quicker, and less costly to build small standalone dwellings (or ‘granny flats’) by exempting some from the requirement to obtain a building consent.
By early 2026, setting up a shed granny flat could be more feasible for your home. Here’s a summary of the current granny flat regulations in NZ, what the Bill will change, and what the new rules involve.
Current Laws
- Under the Building Act 2004, any building work for a small standalone dwelling requires a building consent.
- That process ensures independent oversight so that buildings are safe, durable and healthy. But it can be time-consuming and expensive. For example, an estimate-building consent for a 70sqm granny flat might cost over $4,000.
- Other regulations and requirements can also apply, such as plumbing, drainage, electricity and gas, plus local council rules, bylaws and natural hazard considerations.
What Will Change
The Amendment Bill will introduce a building consent exemption for small standalone dwellings under certain conditions. Key proposed changes include:
1. Size, design and type
- The exemption would cover new, standalone, single-storey dwellings up to 70sqm.
- The design must be ‘simple’, using lightweight materials for the roof and frame, as well as straightforward plumbing and drainage systems.
- The dwelling must meet the Building Code.
2. Who does the work
- Building work must be done or supervised by authorised/licensed
- There are requirements to provide records of work and certificates for plumbing, gas and electric safety.
3. Notification to Council (Territorial Authority)
- Before starting, the homeowner must apply for a Project Information Memorandum (PIM) to notify the council. This helps the council assess whether the proposed dwelling is likely to meet the exemption conditions, flag natural hazards or bylaws.
- On completion, the homeowner must submit final records, certificates, plans, and notify the council. There may also be development contributions (infrastructure charges) as part of this process.
4. Liability, safety and compliance
- Even if a dwelling is exempt from consent, it must meet the Building Code. Safety, durability and health standards still apply.
- Licensed professionals are responsible. There are penalties for non-compliance and failure to submit required work records.
5. Infrastructure and Council Charges
- Councils can still collect development contributions through the PIM process. That means homeowners won’t get a free pass on those infrastructure costs.
What This Means for KiwiSpan Customers
KiwiSpan builds many cabins, studios, rumpus rooms, and even granny flats. The new rules present a range of potential benefits for our customers, along with some important considerations when it comes to setting up a shed house.
Here are the implications:
Lower costs and faster build process
- If your KiwiSpan build is for a standalone dwelling within the 70sqm limit, with a simple design and constructed by licensed builders, we may no longer need to go through the full building consent process, reducing fees, paperwork and time.
Design considerations
Your local KiwiSpan team will help you ensure your project meets the defined ‘simple design’ criteria from the Building Code:
- Lightweight materials for frame and roof
- Simple plumbing and drainage systems
- Single storey
Our more custom or complex builds might exceed what the exemption allows, meaning we will still need to go through the consent process.
Notification & documentation is still required
Even without a building consent, you’re still required to apply for a PIM, provide final plans and records, retain all necessary safety certificates, and notify the council once the work is complete.
Where KiwiSpan builds may or may not qualify
If your build is attached to the main dwelling, is multi-storey, has complex plumbing or drainage, uses complex materials and structural systems or exceeds 70sqm, then you will still require council consent. Also, if there are site-specific issues, such as natural hazards or bylaws, councils may require further compliance or consents.
When Will the Granny Flat Changes Take Effect?
The government expects the building consent exemption for small standalone dwellings to be in force by early 2026.
What You Should Do Now
As a KiwiSpan Customer or Prospective Buyer, here are our suggestions on how best to prepare and plan to get the most out of the new rules and avoid setbacks:
1. Work with KiwiSpan from the start
Our team can manage the entire build process from design through construction and help you understand any additional costs. By involving us early, we can make sure your project meets the exemption criteria and runs smoothly. Check out the past shed homes and sleepouts we have built for inspiration.
2. Plan your idea carefully
If you’re considering a KiwiSpan dwelling, keep your design to a single-storey building under 70sqm. Sticking to these criteria gives you the best chance of qualifying for the exemption once the law takes effect.
3. Be aware of extra costs
Even without a building consent, there may still be charges such as council development contributions, infrastructure fees or site-specific costs. Factoring these into your budget early will help avoid unexpected expenses.
4. Licensed professionals are essential
Your local KiwiSpan team can help you out with licensed builders and certified tradespeople. This is not only a best practice but also a requirement under the proposed rules. Having qualified professionals means you’ll receive the necessary records and certificates to submit to the council.
5. Check your site and local rules
Councils will still assess PIMs and provide advice. Natural hazards, bylaws, zoning or infrastructure constraints can affect eligibility. Getting council feedback early is especially valuable for complex or challenging sites.
Bottom Line & Opportunities for KiwiSpan
This huge change for KiwiSpan means our clients may have a simpler, faster, cheaper pathway to adding granny flats to their property. For many people, this could reduce barriers to improving living arrangements, adding extra income space or providing housing for family or tenants.
At the same time, because there are conditions and limits, not all buildings will qualify. The best strategy is to plan with those conditions in mind.
If you’re considering a KiwiSpan standalone dwelling, now is a great time to explore options. Talk to us about what designs and materials would help meet the exemption, and get your ducks in a row so you’re ready when the legislation comes into effect.
