Granny flat regulations: New rules make it cheaper and easier to build

The Government has amended the Building Act and introduced a new National Direction under the Resource Management Act (RMA). These changes mean that small standalone dwellings up to 70sqm (an increase from the originally proposed 60sqm) no longer require a building or resource consent, provided they meet specific "simple design" criteria.

Under the new law (Schedule 1A of the Building Act 2004), a project must meet specific criteria to be exempt from building and resource consents. If your build falls outside these definitions, you will still need to go through the traditional (and more expensive) consenting process.

To qualify for the exemption, a granny flat must meet the following requirements:

Size & type

The unit must be a new, standalone dwelling (not a conversion of a garage or addition to the main house) and no larger than 70sqm.

Design & height

It must be a simple, single-storey design with a maximum building height of 4 metres above floor level. The floor itself cannot be more than 1 metre above the supporting ground.

Materials

To keep the design "simple," the law requires lightweight materials - specifically timber or light-steel framing and lightweight roof cladding.

Placement 

The unit must be at least 2 metres away from any other residential building and any legal property boundary.

Services 

It must be self-contained with its own kitchen and bathroom. To be exempt, you cannot use "wet-floor" or level-entry showers that require a waterproof membrane; you must use prefabricated acrylic shower units. Additionally, solid-fuel heaters (wood burners) are not permitted in exempt builds.

Zones

It must be located on residential, rural, mixed-use, or Māori-purpose land.

Professionals 

All work must be carried out or supervised by Licensed Building Practitioners (LBPs) or registered professionals (plumbers, drainlayers, etc.). You must also obtain a Project Information Memorandum (PIM) from your council before you start.

According to Associate Finance Minister Shane Jones, the removal of these consent requirements is expected to save homeowners up to $5,650 in direct costs and speed up the construction process by as much as 14 weeks.

A crucial note on costs: While building consents are gone, Development Contributions are not. Councils can still charge these fees to support local infrastructure (water, roads, and parks). These are assessed when you apply for your mandatory Project Information Memorandum (PIM). Depending on your region, these can range from $5,000 to over $20,000, so check with your council early.

MBIE’s Granny flats exemption guidance package outlines a specific legal process that must be followed:

• Apply for a PIM: You must receive a Project Information Memorandum (PIM) from your council before any building work starts. This identifies natural hazards and infrastructure connections.
• Hire professionals: Because this is "Restricted Building Work," you must engage Licensed Building Practitioners (LBPs) for the design and build. You cannot DIY the structure or plumbing.
• Completion & notification: Within 20 working days of finishing, you must submit your final plans, "Record of Work" from your LBP, and energy safety certificates to the council to update your property file.

Many companies offer a full "design and build" service, managing everything from site planning to final construction. This often includes off-site methods like prefabricated or modular builds, which are manufactured in a factory to ensure high quality and minimal on-site disruption. For these units, you still need a PIM for the final location where the building will be placed.

Regardless of the method, all professionals must be appropriately licensed. For a complete look at your legal obligations and step-by-step checklists, refer to the official MBIE Granny Flat Guidance.