The Government has allocated $100 million to be lent to developers for housing infrastructure and aims to streamline the Resource Management Act, which currently restricts the availability of land for development. Housing and Infrastructure Minister Chris Bishop announced the suite of changes aimed at accelerating outer-city housing development.
“The government is committed to letting our cities grow up and out to address our housing crisis,” he says. “Medium-sized greenfield developments play a crucial role in increasing supply, but without the right support, many projects risk being delayed or unable to progress.”
He says these immediate changes are necessary interim measures to help boost housing supply, and that there is no time to waste.
“The government’s Going for Housing Growth and Resource Management Act reforms will be critical in addressing our housing crisis – but it will take time to legislate and then bed in,” he says.
“The government’s National Infrastructure Funding and Financing Agency (NIFFCo) has been developing a pipeline of potential important greenfield projects, and the initial transactions are expected to be drawn from this pipeline.”
That includes the launch of a new initiative, the Greenfield Model, managed by the National Infrastructure Funding and Financing Agency (NIFFCo). Under this model, NIFFCo will offer low-interest loans during the development phase of housing projects, typically the riskiest and most expensive stage. Private markets will later refinance the loans once development is complete.
Future homeowners will repay these loans through an annual levy. The funding will be sourced from existing unallocated NIFFCo resources, which will be reinvested in new projects over a five- to seven-year period.
“The development phase of a project is often the riskiest, and private financiers reflect this by charging higher interest rates.
“NIFFCo’s loan will provide lower-cost financing to developers over the development period by charging approximately what private financiers would charge for completed developments.
“This support will bridge the financing gap and help ensure that new homes continue to be built in areas where they are needed most.
Chris Bishop also announced that the Cabinet has agreed to remove LUC-3 protections from the National Policy Statement on Highly Productive Land (NPS-HPL) this year, fulfilling the National Party’s election promise.
“The NPS-HPL protects our productive soils from development, ensuring New Zealand has a secure food supply. However, there needs to be a balance between how we protect our most productive land with our need for more housing to tackle our housing crisis.
“As currently drafted, the NPS-HPL protects a total of 15% of the country’s landmass. Three classifications of soil are protected under the NPS-HPL, with two-thirds being classified as LUC-3, the lowest quality.
“Across the country, this change has the potential to open up new land for greenfield housing roughly equivalent to the size of the Waikato region.
“To ensure we have got the balance between protecting our food supply and enabling more houses to be built, alongside this change, we are going to consult on whether we should establish ‘special agriculture zones’.
“These would essentially protect LUC 1, 2 and 3 land when it is grouped together in a natural configuration in key horticultural hubs like Horowhenua or Pukekohe.
“These are good, short-term and cost-effective interventions while we get the underlying system settings right to fix our housing crisis. They will both make it easier to bring new, much-needed housing projects to market that otherwise wouldn’t have happened or would have happened much later.”
At the heart of the government’s greenfield development is the challenge of increasing the supply of housing without sacrificing the land needed to grow our food. The solution, officials say, is about striking a balance between unlocking land and safeguarding its most valuable parts.
By removing protections from LUC-3 land—the lowest quality of the three—the government aims to create new housing opportunities while maintaining restrictions on higher-quality soils (LUC 1 and 2).
That alone could make space for housing projects across land roughly equivalent to the size of the Waikato region. But not all LUC-3 land is equal. In some regions, it’s part of a cluster of highly productive land essential to horticulture and food security, hence the creation of ‘special agriculture zones’.
Still, the balance won’t be easy. Overdevelopment risks weakening the country’s food production systems. But overprotection risks pricing even more New Zealanders out of home ownership. That’s why the government stresses the importance of targeted, flexible policies that can adjust to regional differences and evolving needs.
Another challenge is the risk of urban sprawl, where cities spread outwards in low-density patterns, increasing reliance on cars, straining infrastructure, and consuming more land than necessary. Poorly planned sprawl can lead to longer commutes, higher emissions, and disconnected communities.
Critics warn that unlocking greenfield land without strong planning rules could worsen these issues. To avoid this, housing development will need to be paired with smart urban design and transport investment that supports compact, liveable communities.
If successful, the strategy will enable cities to expand outward where it makes sense, without compromising the land we rely on to feed the nation. But the true test will be whether this approach can deliver real results in housing supply while maintaining New Zealand’s long-term food security.
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