The council can buy land to build houses on it. You need to know that this rule is part of the Local Government Act 1974, which is a law about how local councils work. The rule about councils buying land for housing is not a law anymore because it was repealed on 1 July 2003 by section 266 of the Local Government Act 2002. The Local Government Act 2002 is a law that changed some rules about local councils. This change happened when the new law came into effect.
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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM421994.
549A: United council and regional council may only act under this Part in response to developments for which it may determine development levy, or
"Councils can only charge a development levy when new houses, shops, or factories are being built."
551: Council may subdivide land, or
"Council can divide land into smaller parts for housing, but this rule is no longer used."
