Tauranga City Council's Urban Form and Transport Development Committee has heard the city is to face a shortage of around 1000 new dwellings before mid-2022, if current demand for new housing continues.

The forecast was part of an independent residential development capacity review that looked at available land for housing development in the next three to 10 years.

The review projected the shortfall would increase further until sufficient new supply becomes established.

Development constraints are due to a combination of very high growth rates in recent years, with Tauranga growing by 13 per cent in the past five years and delays in council's ability to rezone new supply. These delays apply particularly to new urban growth areas.

Committee Chair Larry Baldock says it's important to provide for future growth and council would be working with Central Government, the NZ Transport Agency, Western Bay of Plenty District Council and other key partners with urgency to increase the supply of developable land as well as progress plans for intensification close to the city centre.

'While there are obstacles to our continued growth we are committed to working with our partners to address the problem of developable land supply.

"The benefits of further growth are numerous; keeping jobs and economic growth positive among them as well as also trying to manage housing affordability, but we still need the right infrastructure to support our rapid growth."

Tauranga City Council and the SmartGrowth partnership have been progressing a number of key projects to meet the demand for developable land for some time.

The Western Bay of Plenty has three major greenfield areas for which councils are progressing planning; Te Tumu, Tauriko West and Omokoroa Stage 3, but each area faces significant delays and risks.

Transport investment from central government is required to unlock development capacity at Tauriko West.

Tauranga City Council staff are now working with the NZ Transport Agency on the development of an initial package of transport improvements that would enable development in Tauriko West to proceed.

Council has largely completed structure planning for the Te Tumu area and is undertaking the technical work to prepare for rezoning.

The next step for Te Tumu is to unlock access through multiply-owned Māori land, to enable other land to be developed. This decision is currently subject to Māori Land Court and Māori Appellate Court processes.

The Western Bay of Plenty District Council is leading work to add development capacity in Omokoroa and Katikati with little capacity left in these towns.

However, there is uncertainty around the timing of transport capacity improvements along the connecting northern corridor which poses a challenge. This will be considered by UFTI.

In Tauranga, while average section sizes have been reducing considerably, not enough alternative, higher density dwelling types, such as townhouses and apartments have been built in the existing urban area to date.

With the support of the SmartGrowth partnership, Tauranga City Council is progressing work to enable the intensification of the existing urban area, starting in the Te Papa peninsula from the City Centre to Greerton.

All work to enable new development capacity will be progressed as quickly as possible. Following Government's decision to discontinue the Housing Accords and Special Housing Areas Act, council will look to utilise other processes under the Resource Management Act to speed up planning processes.

The Residential Development Capacity Review was commissioned to ratify views of council and local developers who presented to the Urban Form and Transport Development Committee earlier this year on the impending shortage of developable land in Tauranga.

Following the meeting, Veros Property Services were commissioned to undertake the independent review of the remaining residential capacity in the Western Bay of Plenty sub-region.

Read the full report.