Growth in medium density housing

This Issue This is a part of the Medium-density housing feature

By - , Build 154

Builders could consider scaling up their operations to include medium-density housing (MDH) as the numbers of these dwellings increase.

Figure 1: Multi-unit building consents during 2015. (Source: Whats On database.)
Figure 2: Units per building consent during 2015. (Source: Whats On database.)

WHAT DO WE MEAN by medium-density housing (MDH)? The Ministry for the Environment defines it as a development with:

  • four or more dwelling units
  • less than 350 m2 land area per unit
  • 4 storeys or fewer.

This could include stand alone dwellings in one development. The draft Auckland Plan, for example, provides for one dwelling per 300 m2 of land in the Mixed Housing Suburban zone.

Given Auckland land prices, housing density is likely to be higher than this in many places.

Different from traditional houses

There are opportunities for builders as MDH takes a greater share of new housing, but this differs from normal building practice.

NZS 3604:2011 Timber-framed buildings covers the design and construction for up to 2½ storeys. Beyond this, the building is specific design and may have construction requirements (such as fire or acoustics) that traditional single-house builders have not encountered.

Construction ranges from 1–4 storeys and can use lightweight timber or steel, precast concrete and structural steel.

Site access may be an issue. Site density is greater than traditional sites with simultaneous work on buildings close by. The available construction area outside the building footprint may be small, requiring better site management.

20% of new dwellings MDH and rising

Statistics New Zealand reports dwelling building consents in four categories:

  • Houses – stand-alone (70%).
  • Apartments – vertically attached units with separate occupancies (10%).
  • Retirement village units – licence-to-occupy dwellings, apartments or stand-alone (7%).
  • Townhouses/flats and other – usually horizontally attached between separate occupancies (13%).

The last three total 30% and include MDH, high-rises and others are low-density developments. After adjustments, currently about 20% of all dwelling units in New Zealand are MDH. This is highest in Auckland at 30%, Wellington at 25% and Canterbury at 20%. We expect these percentages to increase by about 10% over the next few years.

Many MDH projects quite small

BRANZ analysed the Whats On database to find the numbers of storeys and units in multi-unit projects.

In the last year, about 75% of multi-units were in buildings 4 storeys or fewer, representing about 6,100 units (see Figure 1). Another 2,000 multi-units were above 4 storeys.

Figure 1: Multi-unit building consents during 2015. (Source: Whats On database.)

Many of the 4 storey and below projects are quite small in scale (see Figure 2). Projects with 10 or fewer units account for almost 50% of all new multi-units – about 4,000 dwelling units per year.

These findings suggest this is a significant market for builders thinking about scaling up their operations to include MDH.

Figure 2: Units per building consent during 2015. (Source: Whats On database.)

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Figure 1: Multi-unit building consents during 2015. (Source: Whats On database.)
Figure 2: Units per building consent during 2015. (Source: Whats On database.)

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