A major ruling from the Ministry of Business, Innovation and Employment (MBIE) has confirmed that flat owners in Christchurch cannot legally operate short-term rental properties without formal consent from the local authority.
The determination centres on a ground-floor unit on Gloucester Street, which was officially classified as residential housing when it received its code compliance certificate in May 2025. The property’s owners, T Denman and K Suter, began offering the property for nightly bookings through an online platform without notifying the council of the change.
Council Takes Action
When Christchurch City Council discovered the unauthorised commercial use, it issued a notice to fix in March, requiring the owners to either obtain written permission for the change of use or return the property to permanent residential occupation.
The owners disputed the ruling, claiming they had sought advice from the council beforehand and believed short-term holiday letting would not require a change-of-use application.
MBIE Upholds Council Decision
MBIE principal adviser Rebecca Mackie determined that the pattern of occupation constituted a material change of use. She explained:
“The unit is made available to members of the public as short-term accommodation through an online accommodation platform, with different occupants able to stay on a nightly or weekly basis. That pattern of occupation is transient, rotational and commercial in character.”
Mackie concluded that “the purpose of the use is to rent the unit out as temporary accommodation. That use is materially different from the purpose of the Housing category.”
The decision also highlighted that conversion to short-term accommodation triggers stricter Building Code requirements, including provisions for accessibility and disability facilities.
Implications for the Sector
Property consultant Mike Blackburn flagged the determination as significant for the short-term rental market, noting: “Where Council determines that a change of use has occurred, the Building Act process can also bring additional Building Code requirements into consideration.”
He advised: “For developers, designers, property owners and operators involved in this part of the market, Determination 2026/026 is therefore one worth being aware of.”
Source : thepress.co.nz