Will RMA change mean cheaper houses?

Changes planned for the Resource Management Act (RMA) should reduce house prices and improve supply - provided they are able to be enacted, economists say.

The government announced on Monday that it plans to introduce two new pieces of legislation to replace the Act by the end of this year.

It will streamline planning systems between councils, lift the number of "permitted activities" and set environmental limits.

It said this should reduce administrative and compliance costs by 45 percent.

RMA Reform Minister Chris Bishop and Undersecretary Simon Court said replacing the RMA with law based on property rights would grow the economy and lift living standards.

"The RMA is broken and everyone knows it. It makes it too hard to build the infrastructure and houses New Zealand desperately needs, too hard to use our abundant natural resources, and hasn't resulted in better management of our natural environment," Bishop said.

Kelvin Davidson, chief property economist at CoreLogic, said it should mean more supply than otherwise, which would then limit house price growth and improve access and affordability.

"Research a few years back identified limited land supply as one of three key upwards drivers for house prices in NZ over several decades, with the other two being downwards trend for mortgage rates and a favourable tax system for property," he said.

"So if we open up more land, it should have an important impact - especially when you put that alongside credit limitations such as debt-to-income ratios.

"However… it's going to be a hard one to discern, because RMA changes will presumably take place over several years, and supply changes can be slow-moving. So yes, I think this an important change, but don't expect overnight results."

Brad Olsen, chief executive at Infometrics, agreed there should be an impact.

"It's quite a fundamental shift. It's felt like with some of the other planning changers, not just from the previous Government but more generally, it's been a bit piecemeal or a bit more tinkering.

"That was understandable, there are some very big and thorny challenges to try to balance out in the planning space.

"I feel like the proposal on the table here is pretty permitting - do it unless there's a good reason not to."

He said while people might argue that the new rules would mean there was a risk things would go wrong and there could be poor outcomes, there was that risk now - and it was a long and expensive process on top of that.

"I'd rather move in direction of let's get stuff done."

He said it would take time to bed in, though.

That could be seen with the Fast-track Approvals Act.

"Even with Fast Track, nothing is being built right this second because of it and nor should it, things take time.

"Some of the cost savings likely to come about do look to be material, the numbers quoted are quite substantial. It shows this is not mere tinkering. This might take a bit of time to come through.

"There won't be nearly as much of a risk that there are big plans made and big expectations start to be talked about only to go nowhere… we might not see it in the next 12 months but once it gets going… it'll take a while to get there but once it hits full speed it will hit full speed quite quickly."

Simplicity chief economist Shamubeel Eaqub said the key would be whether the changes stuck.

The Government has approached the opposition to find common ground.

But Eaqub pointed to the medium-density residential standards (MDRS) which had bipartisan agreement in the previous Government's term, but then was shelved.

"It's all very well to talk about bipartisanship halfway through the electoral term but when the detail becomes apparent political agreement can crumble."

He said there needed to be an open debate so there could be high level agreement, and from there the details could be worked out.

He said the Government needed to not be afraid of confrontation through an open consultation process with both "winners" and "losers" as a result of the changes.

Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.