New Zealand's building consent system is going through its biggest overhaul in decades. The Government has described it as a "once-in-a-generation shift" — and for tradies working in residential construction, it has real practical implications for how jobs get consented, what products you can use, and who carries liability when things go wrong.
Here's what's changing and what it means for your business.
1. Granny Flats No Longer Need Building Consent
The most immediately practical change: granny flats up to 70 square metres can now be built without a building consent, effective from early 2026.
This is significant. Granny flats, minor dwellings, and sleep-outs have historically required full consent — adding weeks or months to the process and thousands of dollars in council fees. Now, provided certain conditions are met, homeowners can build without going through council.
The conditions
To use the exemption, the build must: - Be 70m² or smaller - Use a simple design that complies with the Building Code - Be built or supervised by licensed professionals (Licensed Building Practitioners) - Include notification to the council before work begins and when it's complete
That last point matters for builders. You're not flying completely under the radar — council is notified — but you're not waiting for consent approval before you start.
What it means for your business
Expect more granny flat enquiries. Homeowners who previously found the consent process too daunting or expensive will now look at this as a realistic option. If you're a builder or carpenter, having a clear granny flat offering — with standard 60–70m² designs ready to go — positions you well to capture this work.
The flip side: because there's no consent inspector reviewing the work, your liability as the LBP is higher. You're certifying the work is code-compliant. Document everything carefully.
Use our Job Cost Calculator to estimate a granny flat build and set your quote appropriately.
2. 40,000 More Building Products Now Recognised
The Government has approved nearly 40,000 additional building products under overseas recognition schemes — primarily products already approved and widely used in Australia.
This includes thousands of plumbing and drainage products that Kiwi tradies have been importing informally or working around for years.
Why this matters
Previously, a product being approved in Australia didn't automatically mean it was approved in New Zealand. This created two problems: 1. Cost — some products were significantly cheaper across the ditch but couldn't be legally specified here 2. Delays — sourcing NZ-approved alternatives could take weeks when Australian equivalents were available immediately
With the expanded recognition, you can now legitimately use a much wider range of products without going through separate NZ approval processes. For plumbers and builders in particular, this should reduce material costs and lead times on certain jobs.
Check that products are covered under the specific recognition scheme before specifying them. The MBIE building performance website maintains the current list.
3. No New Consent for Minor Product or Design Changes
Under the old system, if you wanted to substitute a product or make a minor design change mid-build, you often needed to file a consent amendment — more paperwork, more fees, more waiting.
From 2026, minor product substitutions and design changes no longer require a new consent application. Building Consent Authorities (BCAs) can assess compliance with the Building Code without requiring a fresh consent each time.
In practice this means: - If your specified cladding is unavailable and you want to swap to an equivalent product, you don't necessarily need to go back to council - Minor variations from the consented plans (within limits) can be handled without the amendment process - Less back-and-forth for product changes during the build
This should reduce the time and cost of managing in-construction changes — one of the most frustrating parts of running a residential build.
4. Liability Is Changing: Joint and Several → Proportionate
This is the most legally significant change for trade contractors, and it's one that's been debated in the industry for years.
How it works now (joint and several liability)
Under the current system, if there's a defect in a building and multiple parties contributed to it — the builder, the council, the engineer, the subcontractor — any one of them can be held liable for the full cost of repair, regardless of how much they actually contributed to the fault.
In practice, this often means the party with the deepest pockets (frequently the council or a large builder) ends up paying the full amount, even if they were only 10% responsible. They then have to pursue the other parties separately to recover their share — which is expensive and often doesn't succeed.
What changes with proportionate liability
Under the proposed proportionate liability system, each party is only responsible for their own share of the fault. If the builder caused 60% of the defect and the council contributed 40%, each pays their own portion.
A draft Bill covering this change was expected in early 2026. Check the MBIE website for its current status.
What it means for subcontractors and trade contractors
Currently, being named in a building defect claim — even as a minor party — can be very expensive because of the joint liability risk. Under proportionate liability, your exposure is limited to what you actually contributed.
This is broadly positive for trade contractors, especially subbies who contribute one component of a complex build. It reduces the tail risk of being caught up in another party's failures.
For business insurance purposes, this change may affect what level of professional indemnity cover you need — worth a conversation with your insurer once the legislation passes.
5. Building Consent Authorities: Voluntary Consolidation
The Government is making it easier for councils to voluntarily consolidate their Building Consent Authority functions. Currently, each council runs its own BCA — and there's significant variation in quality, processing times, and consistency of decisions.
Consolidation would allow smaller councils to pool resources with larger ones or hand off consent processing entirely. The goal is more consistent outcomes and faster processing times across the country.
Processing times as of late 2025: - Median residential consent: 10 working days - Median commercial consent: 13 working days - 96% of residential consents processed within the 20-day statutory timeframe
Those numbers aren't bad, but there's still significant variance between councils. Tararua District, for example, flagged processing delays into 2026. Consolidation aims to smooth out those regional differences.
The Bigger Picture: Why This Matters for Tradies
The consent system has been one of the most persistent complaints from everyone in the building industry — builders, architects, and homeowners alike. Processing delays add cost. Product restrictions add cost. The liability system drove up insurance premiums and made businesses reluctant to take on complex work.
These reforms don't fix everything overnight, but they're substantive changes in the right direction:
- Granny flat exemption → more work, faster starts
- Product recognition → cheaper materials, less waiting
- No consent for minor changes → less admin mid-build
- Proportionate liability → fairer risk allocation
- BCA consolidation → more consistent decisions
For builders running residential projects, the combined effect should mean faster job starts, less mid-build disruption, and a cleaner liability picture.
Staying Across the Changes
The reforms are rolling out through 2026. Keep an eye on:
- building.govt.nz — MBIE's Building Performance site, which tracks legislative changes and consent processing statistics
- NZCB (New Zealand Certified Builders) and Registered Master Builders — both publish industry updates on regulatory changes
- Your local BCA — processing times and amendment processes vary by council until consolidation takes effect
For your day-to-day admin, make sure your job management software is keeping clean records of what was consented, what products were specified, and any changes made during the build. Tools like Fergus and Buildxact can document this automatically as part of the job file.
Quick Reference: 2026 Building Consent Changes
| Change | Status | Impact |
|---|---|---|
| Granny flat consent exemption (≤70m²) | In effect 2026 | Faster starts, more residential work |
| 40,000 new overseas products recognised | In effect 2026 | Cheaper materials, less sourcing delay |
| No consent for minor product changes | In effect 2026 | Less mid-build admin |
| Proportionate liability (replaces joint & several) | Bill in progress | Fairer risk, lower tail liability |
| BCA voluntary consolidation | Legislation in progress | More consistent processing |
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