Big increase in consents points to positive outlook for builders
The latest building consent stats confirm what many in the building industry have been sensing for a while: After a long flat period, a significant uptick in residential building activity is well underway.
According to Stats NZ, 36,944 new homes were consented in the year to January 2026, up a healthy 9.3% compared with the previous year. That’s an average figure for all ‘homes’.
When looking at the different categories, standalone homes had a strong gain with 16,748 consented, up 5% compared with the previous year, whereas townhouses, flats and units were up a massive 14% with 16,175 consents.
Growth in most regions
Auckland had the most consents (up 13%) and accounted for nearly 60% of the national increase, largely driven by medium-density townhouse projects.
Other regions recording solid growth include Canterbury (up 12%), Wellington (up 16%), Waikato (up 9 %) and Otago (up 11%).
Several smaller regions also posted strong gains, with Nelson and Southland recording annual increases of more than 30%.
After several challenging years for the construction sector, the latest figures suggest residential building activity is in a growth phase, with a building pipeline of projects expected to support work through 2026.
While all the signs are positive, international events may moderate growth, with the war in the Middle East and rising oil prices leading to greater economic uncertainty.
The four regions with the most consents issued were:
▶ 15,617 in Auckland (+9.7%)
▶ 7,316 in Canterbury (+11.8%)
▶ 3,044 in Waikato (+10.5%)
▶ 2,171 in Wellington (+18.4%)
Townhouse oversupply tough on developers
The huge rise in consents for townhouses in recent years may decrease this year as developers struggle with a glut of unsold stock due to a mismatch in the supply/demand cycle.
With a difficult economy and a slump in net migration, a growing number of newly built townhouses are sitting on the market so long that they are losing their ‘new build’ status, highlighting the extent of oversupply in parts of the housing market.
To qualify as a new build, a property must have received a code compliance certificate within the past six months, never been lived in, and be purchased directly from the developer. That status allows buyers – particularly firsthome buyers – to access lower deposit lending options.
However, strong development activity in recent years has left some markets saturated, particularly in Auckland and Christchurch, with many listings lingering beyond the six-month window.
Some developers are now placing unsold properties into rental pools or short-term accommodation, which also removes their new-build eligibility. The situation is also evident in the apartment market, although the numbers are smaller.
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How the new granny flats building consent exemption is changing restricted building work for LBPs
While the definition of Restricted Building Work (RBW) has not changed, the way RBW is delivered under the granny flats building consent exemption has.
Codewords article provided by the Ministry of Business, Innovation and Employment.
The new granny flats building consent exemption allows certain new small standalone dwellings up to 70 square metres to be built without a building consent, provided all exemption conditions are met, and the work is carried out or supervised by licensed building professionals.
Because councils will not review or inspect exempt work, Licensed Building Practitioners (LBPs) play a central role in ensuring these buildings are still designed and constructed to comply with the Building Code.
This article outlines what the exemption means for LBPs, including where responsibilities have increased.
What the exemption allows
A new, single storey, standalone dwelling up to 70 square metres can be constructed without a building consent if it meets all criteria in Schedule 1A of the Building Act 2004. This includes, but is not limited to, the following:
▶ It meets the requirements for a detached dwelling, as defined in clause A1 of the Building Code
▶ It has a maximum height of 4 metres above the floor
▶ It has a floor level of up to 1 metre above the supporting ground
▶ It must not contain a mezzanine floor
▶ It has a frame made of lightweight building products (such as steel or timber)
▶ It is at least 2 metres away from any other residential building or any legal boundary
▶ It is built using lightweight building products for the roof that have a maximum weight of 20 kilograms per square metre
▶ Its wall cladding has a maximum weight of 220 kilograms per square metre or less
▶ Its water supply, sanitary plumbing, and drainage must meet specific requirements
▶ It must have an independent source of supply for electricity and, if gas is to be used in the dwelling, an independent source of supply for gas
▶ Where heaters are installed, they must be either electric or gas heaters
▶ It does not have a level entry shower requiring a waterproof membrane.
The work must be carried out or supervised by licensed practitioners. If the granny flat does not meet all the exemption conditions, the building work requires a building consent.
These criteria are in addition to the requirement that the building be built to the Building Code. The New Zealand Building Code consists of three general clauses (A1–A3) and 38 technical clauses (B1–H1). These mandatory, performance-based clauses cover stability, fire safety, moisture, user safety, services, and energy efficiency.
What this means for Design LBPs
Designers retain their existing RBW obligations, but the exemption increases the importance of accuracy and clarity because councils will not review design documentation.
1. Confirming the project qualifies
Designers must ensure the design meets all exemption criteria. A single non compliant feature, such as exceeding the 70 square metre limit or including heavy wall cladding, moves the work outside the exemption and triggers the need for a building consent.
2. Producing clear, compliant designs
Designers must clearly demonstrate how the design complies with all the relevant Building Code clauses, particularly:
▶ B1 Structure
▶ B2 Durability
▶ C1–C6 Fire Safety
▶ E2 Weathertightness
Without council review, documentation must be clear and easily understood by other LBP’s during the construction phase.
3.
Completing updated MBIE documentation
Designers must provide a Certificate of Work (CoW) for the design of RBW, using Form 2A: Memorandum from licensed building practitioner (certificate of design work).
These documents become the primary evidence of Building Code compliance because no building consent or Code Compliance Certificate will be issued.
Under the exemption, a designer’s involvement is likely to extend further into the construction phase than in a standard consented project. Final plans and supporting documentation must accurately reflect the building as completed, which may require the designer to stay engaged until construction is finished.
Designers may wish to review and update their contracts, ensuring they clearly capture this ongoing involvement, including obligations to verify that the final build aligns with the approved design documentation and exemption criteria.
4. Supporting the homeowner
Designers should advise homeowners to:
▶ obtain a Project Information Memorandum (PIM) before work begins
▶ notify the council before starting and after completing the work
▶ avoid unapproved design changes during construction, which may invalidate the exemption.
What this means for Builder LBPs
Without council inspections, builders are responsible for verifying that construction is carried out exactly as designed and complies with the Building Code.
1. Building strictly to the approved design
On site changes can unintentionally breach exemption conditions. Even minor adjustments to layout, claddings, foundation details, or drainage systems may trigger the need for a building consent.
2. Self checking for Building Code compliance
Traditional inspection steps are not carried out by councils. Instead, during construction, builders are responsible for ensuring building work complies with the Building Code in areas such as:
▶ structural framing and bracing
▶ foundation preparation and reinforcement
▶ cladding systems, flashing installation, and weathertightness detailing.
3. Managing and supervising subtrades
All plumbing, drainage, gasfitting, and electrical work must continue to be performed or supervised by appropriately licensed professionals.
Builders should ensure:
▶ subcontractors hold the correct licence classes
▶ all relevant RoWs are completed and collected
▶ work aligns with the original compliant design documentation.
4. Completing documentation
Builders must provide the homeowner with a RoW for restricted building work they carried out or supervised. If more than one builder carried out or supervised restricted building work, they each need to provide a RoW for their work.
The builder must also provide this to the council that issued the PIM. These documents protect both the builder and the homeowner and may be reviewed in future insurance or legal processes.
5. Communicating clearly with the homeowner
Builders should ensure homeowners understand that:
▶ a PIM must be obtained from their local council before work starts
▶ no council inspections will occur
▶ non compliant changes can invalidate the exemption and create enforcement or insurance issues.
Clear communication reduces misunderstandings and protects all parties from disputes.
Conclusion
The granny flats building consent exemption has not changed what constitutes Restricted Building Work, but it has fundamentally changed how RBW is verified. LBPs must ensure that granny flats are designed and built to meet the exemption conditions and comply with the Building Code.
Designers and builders who understand the exemption criteria, maintain strong communication, and produce clear documentation will help homeowners realise the benefits of faster, lower cost construction, while upholding building quality and safety.
Codewords
Quiz
1. Under the granny flat exemption, who has the responsibility during construction to ensure that all building work, including any RBW, continues to comply with the Building Code and the conditions of the exemption?
a) The local council
b) The homeowner
c) Licensed Building Practitioners (LBPs)
d) The building inspector
Granny Flats Exemption Guidance
2. What is still required for structural and weathertightness work in an exempt granny flat?
a) A full building consent
b) A Licensed Building Practitioner to carry out or supervise the work
c) Council inspections at key stages
d) A Code Compliance Certificate
3. What happens if a change pushes the project outside the granny flat exemption criteria?
a) Nothing - the build remains exempt
b) The homeowner only needs to notify the council
c) The project may require a building consent or Certificate of Acceptance (if already built)
d) The builder may approve the change themselves
For more information and to download the Granny Flats Exemption guide, visit www.building.govt.nz
This article is relevant to ALL classes:
ADD TO YOUR LBP ACTIVITY LOG
This article is from Codewords Issue 129.
Log in to the LBP portal lbp.govt.nz (or scan the QR code) and update your Skills Maintenance activities.
Historic double-header a huge bonanza for Kiwi Supercars fans
Double the thrills. Double the excitement. Twice as much of everything. ITM’s long association with Supercars has taken a historic turn with double-header events confirmed in New Zealand until at least 2028.
For the first time, the 2026 Repco Supercars Championship will stage back-to-back Kiwi race weekends at Taupō International Motorsport Park (10–12 April) and Ruapuna Raceway (17–19 April).
It’s also the first time the series has raced in the mainland, making Supercar action more accessible to Kiwi fans throughout the country.
While the Taupō track will be familiar to all drivers, the Ruapuna track has unique characteristics, meaning fans will experience two distinct styles of racing in New Zealand.
Taupō is considered a ‘hard to pass’ track where qualifying position is critical. It features a long 830m back straight but requires high patience in lowspeed, technical corners.
Ruapuna Raceway is a more traditional ‘flowing’ track with a mix of long-radius corners that offer better overtaking opportunities, and is considered a ‘driver’s track’ that rewards precision and smooth driving.
A great start for Kiwis
The 2026 season will be one of the biggest ever, expanding to 37 races across 14 rounds. The first race weekend of the season kicked off at Sydney in February with Kiwi drivers showing good form, capped off by Matt Payne securing top four finishes across three races to end up equal on points at the top of the championship standings.
Payne was also on top of his game in the second round in Melbourne in March, taking second place in races four and five, where he shared the podium with fellow Kiwi Ryan Wood, who finished third.
Fans will also see fresh metal on the grid with Toyota GR Supras lining up against the Mustangs and Camaros for the first time in New Zealand. Kiwi drivers Andre Heimgartner and Wood have switched to Supras, which have proven to be very competitive. All five Supras in the series achieved top-10 finishes in Sydney in February, with Wood scoring a historic first-ever podium finish for Toyota in Melbourne.
With more races, new cars and a landmark Kiwi double-header, the 2026 season is shaping up as one of the most exciting yet for New Zealand racing fans.
More information
For more information and to purchase tickets go to: www.supercars.com/2026/ nz-double-header
Taupō is considered a ‘hard to pass’ track that is more technical and where qualifying position is critical.
At ITM, we know precision matters, whether you’re standing frames or chasing lap times. For 15 years, we’ve stood alongside Kiwi builders and motorsport fans, supporting thrilling Supercars events from the streets of Hamilton to Pukekohe Park Raceway and Taupō International Motorsport Park.
We’re proud to be naming rights partner for the ITM Christchurch Super 440, bringing Supercars to the South Island for the first time. With our ongoing commitment to the ITM Taupō Super 440 through 2028, our partnership goes even further.
In racing, speed wins, but you can’t go fast without teamwork, skill, and getting every detail right. It’s the same on the build site: quality comes from working together, mastering your craft, and never missing the small stuff. From the build site to trackside, it’s that shared commitment to excellence that drives us.
Whetheryou’reonthetoolsorcheeringfromthestands,ITMiswithyouonsite,trackside,everystepoftheway.
ITM. We’ll see you right.
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Building under the new 70sqm ‘granny flat’ exemption rules?
If you are, consider the liability and insurance implications.
From January 15th this year, an exemption to the Building Act means single-storey, stand-alone dwellings less than 70sqm can be built without requiring a building consent. There are several conditions that must be met before the exemption applies, so it’s critical that builders understand what they can and can’t do under the exemption. Failure to comply with these conditions could leave you exposed to liability.
What liability could building under the exemption expose LBPs to?
Most obviously, if an LBP advises a homeowner on whether the granny flat exemption applies and that advice turns out to be wrong, they could be held liable for any costs or losses incurred by the homeowner. This could include additional fees they have to pay, costs to relocate or remediate issues with the dwelling, or, in a worst-case scenario, demolition of the building.
If you’re helping the homeowner through the exemption process, there are many aspects to consider, so it’s critical that you have a robust process and contractual terms and conditions.
Builders could be exposed to fines under the Building Act, such as failing to apply for a building consent when one is required for the work. One example to consider is the property’s exposure to natural hazards. If there’s a risk of flooding or subsidence, ‘adequate provision’ for this must be made, and specific protection measures included in the design. Failure to do so could expose the builder to liability if the granny flat is built under the exemption but should have gone through the building consent process.
While building granny flats is now largely permitted under the Resource Management Act also, there are still conditions. Failure to comply with these could result in prosecution. Some local council district or unitary plans may also still apply, such as rules about subdividing land, earthworks, and specific infrastructure requirements.
Any work done must still comply with the Building Code, and without inspections, the LBP is reliant on their own skills and experience to ensure compliance.
If things turn to custard, the homeowner may also make a complaint to the LBP Board. The LBP may face disciplinary action, including paying costs, a fine and the possibility of a license suspension.
Any work done must still comply with the Building Code, and without inspections, the LBP is reliant on their own skills and experience to ensure compliance. While the current homeowners may be happy to cut a few corners to keep the price down, if the property is sold, the new owners may not be quite so forgiving.
None of the above will be covered by a builder’s public liability insurance, which is limited to cover for accidental property damage and won’t respond to errors in professional advice or design. Nor will it be covered by contract works insurance.
Fines imposed under the Building Act can be insured by statutory liability insurance. But breaches of the Resource Management Act cannot (although
Opinion and advice by Ben Rickard, Construction Risk Expert at Builtin - February 9th, 2026
the cost of defending a prosecution will still be covered). To be covered by a statutory liability policy, the breach must have been unintentional. Some insurers also include cover for defending complaints to the LBP Board (and the fines) under their statutory liability cover. There are still some standalone LBP policies available that do this, too.
Scenario 1: You’re involved in advice, planning and design, as well as building it.
When you’re providing professional services such as design, advice and project management, then professional indemnity insurance is needed. These policies can have a limited scope, often limited to design, engineering, and surveying, rather than also covering construction aspects such as project and construction management. However, design & construct professional indemnity insurance is available and is typically the best option for builders involved in the entire process.
It’s still important to ensure that anyone providing these services has the appropriate qualifications, such as an LBP Design license for design work. Under the Building Act, a designer includes anyone who gives advice about building work, compliance with the Building Code, and whether work requires consent. This could include a builder who takes on the role of designer and drafts some plans for a
client detailing work that will not require a building consent. In the case of an exempt granny flat, however, an LBP Design license holder must be involved.
Both legally and contractually, even if you are subcontracting out some aspects of these professional services, you may still be responsible for them if they go wrong, so covering your liability for their errors is also prudent.
Scenario 2: You’re just building it and not involved in any design or planning
Of course, this makes life easier, in theory. Your obligations in this case are to ensure that the granny flat is built to code, that all documentation (such as Records of Work) is completed and provided to the homeowner and Council and that you comply with your obligations under the Building Act, such as providing a written contract, memorandum and disclosure.
However, as we all know (we’ve certainly seen many clients experience this), just because it wasn’t your problem doesn’t mean you won’t be dragged into the mess. This makes it all the more important that your paperwork is up to scratch, that you document everything and that you have the right insurance in place in case something does go wrong.
Consider using contract management services, such as those available to members of the Building Hub, to ensure that all the i’s are dotted and the t’s crossed.
It’s possible that an LBP contracted to ‘just build’ a granny flat under the exemption may become aware that the construction doesn’t meet the exemption conditions and does, in fact, require consent. What is the LBP’s obligation in that situation? To raise it with the homeowner and/or designer? Or to ‘just do what I am told’? Unfortunately, burying your head in the sand won’t help you when things blow up later. This is almost certainly a breach of the LBP Code of Ethics and of your duty of care to your clients.
As above, if you’re involved in building granny flats under the exemption, even if that’s only on the construction side, some design & construct professional indemnity cover is definitely worth considering.
A word about contract works insurance
Regardless of the approach to building it, contract works insurance will be needed during construction. This covers the cost of accidental damage or loss, such as theft of materials, vandalism, fire, storm, flood, or other natural disasters.
As a new standalone building, it may be taken out by the builder (according to the terms of their contract), which is common practice for full builds. However, since it is on the property of an existing home, the homeowner’s insurer may also be approached to cover it. Who arranges it should be agreed in advance between the two parties, and since it will cover both the homeowner and the builder, the policy documentation should be shared with both before work starts.
Some house policies include an automatic benefit for ‘new building work’. However, a new selfcontained dwelling would typically well exceed the limits below which this extension applies, so a separate contract works insurance policy would almost always be required.
Once practically complete, the building will need to be covered by a house insurance policy.
What about homeowners?
Homeowners must remember to add the dwelling to their existing cover or take out new cover, depending on their insurer’s policy. This includes noting its purpose, such as whether it is being used as a rental.
Homeowners must also be aware of the exemption conditions and ensure their granny flat build complies with them. Even once the build is completed, if it should have been built under a building consent, this could cause issues when they come to sell the property. There may be additional costs for certification and remediation of any problems. Worst-case scenario, it may have to be demolished.
House insurers have indicated that at this stage, they will not require any additional paperwork when granny flats built without a consent need to be added to a policy. They will treat the dwelling like any other, for now. However, they have highlighted that if it has not been built to code, this could certainly cause issues at claim time, particularly if the claim arises from the non-compliant work. The same will likely apply to any natural-hazard damage that was not adequately managed as part of the build.
Another consideration with some insurers is whether the new minor dwelling can be covered under the existing insurance of the main home (to be exempt, granny flats must be built on the same property as an existing main home). If the granny flat is intended to be occupied by members of the same family, adding it to the main home policy makes sense. However, some insurers have indicated that if it is intended for commercial rental, a separate policy would be required.
In a Nutshell
Like any other business opportunity, taking advantage of the granny flat exemption also comes with risk. The rewards need to be balanced by mitigating the risks. Builders entering this new market must understand all the requirements and have a robust process for managing them. Both current and future risks should be considered and allowed for, including having appropriate insurance cover.
Builtin is New Zealand’s Construction Risk Management Expert. For more information, visit builtininsurance.co.nz, email Ben Rickard at ben@builtin.co.nz, or call the team on 0800 BUILTIN.
NZ BUILDING CODE
NEW REQUIREMENTS
From 1st November 2024 the Building Code Acceptable Solutions for Protection from Fire (C/AS1 and C/AS2) came into full effect and made interconnected smoke alarms the minimum fire safety system for new built homes and substantial renovations, citing NZS 4514:2021 – Interconnected smoke alarms for Houses.
All smoke alarms must be either powered by a long-life (minimum 10 years, non-removal and sealed) battery or mains power.
All smoke alarms must be interconnected with each other, this can either be wired or wireless. The CAVIUS Wireless Family alarms connect with each other wirelessly, without the need to run cable between each alarm.
Interconnecting the CAVIUS Wireless Family alarms is a simple and quick process.
A smoke alarm must be installed in every bedroom, living spaces, hallways, and landings within the dwelling. On a multi-level household unit, there must be at least one smoke alarm on each level. If the kitchen is separated from the living spaces and hallways by doors that can be closed, a heat alarm shall be installed. This may include the scullery.
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Once you install a CAVIUS device; if your customer has any concerns or questions, direct them to contact us and we will take care of them for you.
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Built for NZ conditions: DriStud REPEL explained
What is DriStud REPEL, and how does it differ from standard wall wraps?
DriStud REPEL is a reinforced, flexible wall underlay designed specifically for New Zealand’s climate and construction methods. It provides temporary weather protection for up to 90 days, allowing interior work to continue even if cladding is delayed –a major advantage on busy or weather-affected sites.
Unlike standard wall wraps, REPEL combines multiple high-performance properties into a single product. It is CodeMark™ certified and functions as a fire-retardant, vapour-permeable, waterresistant, and flexible air barrier. This means it not only protects the structure from external moisture but also allows internal moisture vapour to escape, helping to reduce the risk of condensation.
One of REPEL’s biggest benefits is its ability to keep projects moving. When cladding delivery is pushed out – a costly and common issue – REPEL enables builders to continue internal work without waiting for the exterior to be closed in. This flexibility helps reduce downtime, minimise delays, and ultimately support more efficient and affordable construction.
Key features:
▶ CodeMarkTM Certified
▶ Fire retardant (FR Index: 1)
▶ Can be used where cladding is installed over a cavity system
▶ Can be used for residential and commercial buildings
▶ Thick and strong
Does DriSpace offer custom print?
Yes – DriSpace offers custom print on both DriStud REPEL and DriStud Wall Wrap.
▶ DriStud Wall Wrap
MOQ – 2740mm x 36.5m (100m2 roll) = 36 rolls.
• Seven colours to choose from, and a maximum of two colours per custom print.
▶ DriStud Repel
• MOQ – 2470mm x 18.3m (50m2 rolls) = c. 73 rolls
MOQ – 2740mm x 27.4m (75m2 roll) = c. 49 rolls
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What accessories are needed to maximise DriStud REPEL properties?
To get the best results from DriStud REPEL, DriSpace recommends using the following system components:
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Window Corners
▶ Plastic Corner Mould (optional)
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For a more in-depth installation guide, visit: www.drispace.co.nz/product/ dristud-repel-vapour-permeableflexible-air-barrier
Improving H1 energy efficiency
The Ministry of Business, Innovation and Employment (MBIE) has updated the settings for compliance with the energy efficiency requirements of clause H1 of the Building Code. These changes follow a review of the H1 settings in 2024, which identified opportunities to better balance upfront building costs and longer-term benefits.
Codewords article provided by the Ministry of Business, Innovation and Employment.
Background
Building Code clause H1 sets the requirements for energy efficiency. This clause requires enclosed spaces where temperature or humidity are modified to provide adequate thermal resistance and to limit uncontrollable airflow in certain buildings. It also sets out physical conditions likely to affect energy performance, and requirements for hot water systems, artificial lighting and HVAC systems.
Significant updates to H1 were introduced in 2021 to improve energy efficiency in new buildings. A review in 2024 identified opportunities to better balance upfront building costs and longer-term benefits, and to improve consistency and certainty of compliance and consenting, while maintaining the required level of energy efficiency.
Since that time, further changes have been made to the acceptable solutions and verification methods for H1 Energy Efficiency to ensure they remain clear, flexible, and affordable for designers, builders and homeowners. The latest targeted changes follow a public consultation from December 2024 to February 2025 and build on the decision to remove the Schedule method as a ‘deemed to comply’ pathway, announced in July 2025.
The Schedule method has been removed
The change that is likely to have the biggest impact for LBPs (especially those holding a Design licence) is the removal of the Schedule method as a compliance option for Building Code clause
H1.3.1(a). This leaves the Calculation method and Modelling method as the two ‘deemed to comply’ pathways for H1.
The Schedule method was a relatively quick and simple way to calculate the amount of insulation needed in different parts of the country to meet Building Code requirements for new buildings. However, this one-size-fits-all approach often proved more expensive than using the Calculation or Modelling methods to determine the appropriate amount of insulation for an individual home.
LBPs who have fully relied on the Schedule method will need to upskill on using the calculation method and may wish to use the free online tools available through BRANZ or the New Zealand Green Building Council.
Designers and architects with access to specialised modelling software can continue to use the Modelling method to meet the requirements of H1/ VM1 or H1/VM2.
Changes to minimum R-values and thermal bridging assumptions
With the Calculation method in H1/AS1 expected to become the primary way to show compliance for the thermal performance of new housing and small buildings, MBIE has taken the opportunity to adjust some minimum R-values in the Calculation method to avoid costly and complex building requirements. This includes reducing the minimum R-values for roofs from R3.3 to R2.6 and removing the minimum R-value for slab-on-ground floors,
as this can be difficult to achieve where the conditioned area above is very small. Despite this, the overall level of energy efficiency required by the Calculation method has not changed.
Another change is requiring thermal bridging from wall framing to be more adequately considered. A recent sample of new residential buildings showed an average framing percentage of 38%, higher than the number assumed by many designers.
Designers will now have to assume a minimum of 38 per cent, unless they can show that a lower percentage is justified. This change aims to improve consistency of R-values between framed and nonframed walls and to provide designers with greater certainty in their calculations.
Clarifying that areas of roofs, walls and floors should be measured internally
Internationally, some building regulations require the use of internal dimensions while others require external dimensions. To ensure clarity and consistency, H1 now makes it clear that overall internal measurements should be used when determining dimensions of roof, wall and floor areas.
Improved modelling methods, enhanced tools, and tables
The other changes made to the H1 acceptable solutions and verification methods focus on improving the usability of the documents and ensuring that the modelling methods in H1/VM1 and H1/VM2 better align with modern building practices.
These changes support consistency in how the modelling method is used, and will provide clarity for designers, building consent authorities and building users that buildings have sufficient insulation.
Transition period until 26 November 2026
The updated AS/VMs are already in effect, and designers have until 26 November 2026 to fully adopt the changes. During the transition period, designers can choose between the previous and the new editions of the H1 AS/VMs. MBIE will work closely alongside the sector to ensure the changes are well understood and implemented effectively. This article is relevant to the Design class:
Codewords
Quiz
1. What is the main purpose of Building Code clause H1?
a) Stability
b) Moisture
c) Access
d) Energy efficiency
2. What are the two remaining ‘deemed to comply’ compliance methods for H1?
a) The Calculation method and the Modelling method
b) The Schedule method and the Guessing method
c) The Computation method and the Estimation method
d) The Schedule method and the Computation method
3. What minimum percentage of framing is required to be assumed under the new H1 AS/VMs when working out the R-value of framed walls?
a) 18%
b) 38%
c) 30%
d) 55%
ADD TO YOUR LBP ACTIVITY LOG
This article is from Codewords Issue 129.
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The new WorkSafe draft code for residential construction
The residential construction sector is currently undergoing a significant regulatory overhaul. WorkSafe New Zealand’s draft Approved Code of Practice (ACOP) for Roles and Responsibilities aims to resolve the long-standing challenges of overlapping duties on complex building sites.
For years, the residential construction site has been a legal ‘grey zone’ of overlapping duties. On any given day, you might have a lead builder, a plumber, an electrician, and a homeowner all technically responsible for the same patch of dirt. The new draft ACOP, set for public consultation from April 20th to May 10th, 2026, finally draws the lines in the sand.
Deemed compliance
The most critical update within the Health and Safety at Work Amendment Bill (2026) is the introduction of ‘deemed compliance,’ also referred to as a ‘safe harbour.’ This provision represents a fundamental shift in how liability is assessed.
If a business follows the ACOP to the letter - such as adhering to specific 2m height-protection standards or 1.5m trench-shoring rules - they are legally deemed to have met their duty. It moves safety from a ‘vague suggestion’ to a ‘verifiable shield.’
Streamlining for small PCBUs
Acknowledging that most Kiwi builders aren’t multinational corps, the 2026 reforms introduce a ‘small PCBU’ status for businesses with fewer than 20 workers.
▶ The Rule: These smaller teams are only required to manage critical risks - those likely to cause death or notifiable injury - and provide basic welfare facilities.
▶ The Reality: You no longer need a 50-page manual for a 70 square metre granny flat; you just need to prove you’ve nailed the big stuff (falls, electricity, and structural collapse).
Homeowner responsibilities
The draft ACOP explicitly includes homeowners for the first time. While the builder remains the technical expert, the homeowner now holds a formal duty of disclosure. If they know there’s an old asbestos pipe 1 metre underground or a dodgy retaining wall, they must tell the contractor. They also cannot pressure contractors to cut safety costs to meet a budget or timeline.
What’s next?
WorkSafe is currently finalising internal ‘practicality tests’ with industry bodies. The official public consultation period is scheduled from April 20th to May 10th, 2026. This is a vital opportunity for construction professionals to provide feedback on the practicality of these standards before the final draft is submitted to the Minister for approval by June 30th, 2026.
In short, the era of ‘I thought the other guy was doing it’ is ending. Whether you’re a lead contractor or a specialist ‘sparkie’, the ACOP will require a single, coordinated Site Safety Plan that everyone actually reads - not just a dusty folder in the back of the ute.
To learn more go about the Approved code of practice for roles and responsibilities in residential construction go to: www.worksafe.govt.nz
Minimum wage increased
The minimum wage rates increased on April 1st, 2026. If you are an employer, business owner, or manager, now is a good time to make sure you have implemented these changes.
New minimum wage rates
From April 1st, 2026:
▶ Adult minimum wage: increased from NZD$23.50 to NZD$23.95 per hour
▶ Starting-out and training minimum wage: increased from NZD$18.80 to NZD$19.16 per hour.
The wage rates shown below are effective from April 1st.
If your payroll system is manual or computer-based, check that your settings will be updated correctly.
If any employees are on starting-out or training wages, this is also a good time to check whether they are due to move to the adult minimum wage.
If any employment agreements are out of date, or if you have employees who do not have a written agreement, it is important to update these now. Make sure the agreement includes all required clauses under the law. You can use the Employment Agreement Builder if you need help.
3. Consider pay relativity
All rates are before tax and before any lawful deductions (such as PAYE, student loan repayments, or child support).
If you have not yet spoken with your accountant, payroll provider, or finance/HR team, it’s a good idea to do this now. You can also take this opportunity to check that your employment records, processes, and systems are up to date.
Things to do
1. Let your employees know
If any of your employees are on the minimum wage or are paid between the old and new minimum wage rate, let them know what their new pay rate will be. You should send them a letter or email confirming the change (this is a variation to their employment agreement).
Their pay will need to increase to at least the new minimum wage, and you may choose to adjust it further to maintain pay relativity within your team.
2. Check your payroll systems and processes
Make sure your payroll provider, accountant, lawyer, finance, or HR teams are ready to implement the new wage rates.
Think about whether the minimum wage increase will affect wage relativity in your workplace. Employees on higher rates may want to discuss changes to maintain pay differences within teams or compared with other employers in your industry.
4. Update your business budget
Review your short- and medium-term budget forecasts and include the increased wage and leaverelated costs. This will help you plan for any financial impact on your business.
5. Refresh your knowledge of minimum wage obligations
Now is a good time to check that you understand how the minimum wage applies. For example, minimum wage:
▶ applies to all hours worked, unless a higher rate is agreed in the employment agreement.
▶ applies to employees paid by salary, piece rates, or commission.
The minimum wage does not apply to:
▶ employees under 16 years of age.
▶ employees with a disability who hold a minimum wage exemption permit issued by a Labour Inspector.
To learn more go to: www.employment.govt.nz
Employment changes: what you need to know
New employment settings took effect on February 21st, 2026, giving you more flexibility and guidance on hiring, contractor arrangements, and handling workplace issues, as well as cutting compliance costs.
Clearer rules on whether
someone
is a contractor or an employee
You can now use a new gateway test to check if your worker is a contractor or an employee.
The test covers such things like what is in their written agreement and when they can choose to work.
The gateway test aims to deliver more upfront certainty for both you and your worker, and reduce the likelihood of disputes over employment status.
Employee or contractor? To learn more about the difference go to: www.employment.govt.nz
New employees can now start on individual terms immediately
Your new employees can now choose to go on an individual employment agreement from their first day.
They no longer need to start on a collective employment agreement for their first 30 days.
You still need to give your new employees information to help them understand union membership, but you no longer need to provide the previous ‘active choice’ form.
Collective and individual employment agreements.
To learn more go to: www.employment.govt.nz
Changes to rules about personal grievances
There have been changes to the rules for personal grievances.
A personal grievance is an action that an employee can take against a current or former employer when they have an employment issue they are unable to resolve.
▶ Employees who earn $200,000 or more a year under new employment agreements can no longer raise a personal grievance related to unjustified dismissal (or unjustified disadvantage connected to their dismissal).
▶ You and your employee can agree to keep dismissal protections if you want to.
▶ Employees on current agreements have 12 months before the threshold applies to them. This gives you both time to renegotiate agreements if needed.
There are also stronger consequences where an employee’s conduct contributed to a personal grievance.
Personal grievances.
To learn more go to: www.employment.govt.nz
What you may need to do now
You may need to review and update:
▶ your individual employment agreement templates
▶ your hiring and onboarding steps
▶ your policies on conduct, performance, and disciplinary processes
▶ how you engage and work with contractors.
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