It sets out the policy as a way of making it "easier to build granny flats and increase the supply of affordable homes for all New Zealanders".
NZ First leader and Acting Prime Minister Winston Peters announced the move alongside Housing and RMA Reform Minister Chris Bishop after the Monday Cabinet meeting.
Prime Minister Christopher Luxon was overseas, headed to Japan for an official visit.
The move follows a commitment in the National-NZ First coalition agreement, which requires the government to "amend the Building Act and the resource consent system to make it easier to build granny flats or other small structures up to 60 square metres, requiring only an engineer's report".
However, the discussion document released as part of the announcement makes clear the requirement for an engineer's report was being abandoned, as it could mean additional costs and engineering services.
"Instead, we are proposing that all work is conducted or supervised by competent professionals under current occupational licensing requirements to ensure all building work will meet the Building Code," the documentation states.
Peters said the policy would "make it more affordable for families to live the way that suits them best".
"High housing costs have a greater impact on Māori, Pasifika, and people with disabilities, as well as seniors - so unlocking the space in the backyards of family members opens the door to new ways of living," he said.
"We know granny flats are a great option for seniors, but they're also increasingly popular with other families such as those who want homes where their university-age children can live at home but maintain some privacy and independence, or families who want to provide extra support to a loved one."
Bishop said many councils already allowed granny flats without requiring a resource consent.
"But there's a lack of consistency and different standards across the country. We're proposing a National Environmental Standard (NES) to require all councils to permit a granny flat on sites in rural and residential zones without resource consent. An NES means changes can come into force quickly."
It would apply in rural and residential zones, but the documents called for feedback on whether it should apply in other areas like mixed-use zones.
The changes would also need to be balanced against things like flood risk, so some district plan rules would still apply. As well as building size, other restrictions include percentage of a property able to be covered in buildings, and distance from a boundary.
Consultation is open from today, June 17, until 5pm on August 12. Final policy decisions will be made later in 2024, expected to be in place by mid-2025.
