Understanding Auckland Council’s Storm and Flood Damage Property Buy-Back Scheme

2 February, 2024 | Wade Hansen

In the wake of the extreme weather events of January & February 2023, Auckland Council has introduced a buy-back scheme aimed at aiding homeowners with properties significantly impacted by the storms and floods.
This initiative is particularly pertinent for residents in the vulnerable areas of Muriwai, Karekare, and Piha, where the forces of nature have left a notable mark.

Initial Assessment: Understanding Your Eligibility
The Government has developed a three level risk category system:

Category Risk Level Status
One Low Risk Repair to previous state is all that is required to manage future severe weather event risk. This means that once any flood protection near the property is repaired, the home can be rebuilt at the same site.


Two Managed Risk Community or property-level interventions will manage future severe weather event risk. This could include the raising of nearby stop banks, improving drainage or raising the property


Three High Risk Areas in the high risk category are not safe to live in because of the unacceptable risk of future flooding and loss of life. Homes in these areas should not be rebuilt on their current sites

Properties that are assessed as being Level Three or High Risk are eligible for the Auckland Council buy back scheme. The property must have a dwelling on it, the scheme is not open to the owners of vacant land. The property can be the owners’ permanent residence or a secondary property such as a beach house or investment property.

For properties with mixed-use (such as those combining residential with commercial or agricultural functions), Auckland Council will focus solely on the residential segment for the buy-out, which will be discussed and determined during the offer negotiation phase.

Additionally, if the property has been sold since 26 January 2023, eligibility is at the discretion of Auckland Council.

Property owners are granted a three-month period to contest their property’s classification following official notification from the council.

Once assessed as being category three, the Council will contact the homeowner to let them know they are eligible for the buy out and ask if they want to opt-in to the buy-out process.


How do I get my property categorised?
To get a category for your property, you need to ask the Council for a detailed risk assessment to be completed. You can request this by filling in a form online here.

The assessment is completed in two parts.  An initial desktop assessment will be conducted using available data and any information you provide to determine if the property is at a low or high risk, and to ascertain the necessity of an on-site assessment. If the desktop assessment indicates the property could be at high risk, an on-site evaluation will be required to closely examine the physical attributes of the property.


Valuation Process: How much will property owners be paid?
The valuation of eligible properties will be completed by a panel of registered valuers appointed (and paid for) by the council, utilising the pre-weather event market conditions as of 26 January 2023.

Property owners can choose to use their own registered valuer, but they will have to pay the costs involved (less a professional fees contribution from the Council) and the valuer will have to follow the methodology outlined by the council.


Insured Properties
This valuation forms the basis of the buy-out offer but does not oblige homeowners to accept. Upon valuation, homeowners receive an offer that deducts a 5% homeowner contribution from the market valuation for those insured, alongside adjustments for any insurance or Earthquake Commission (EQC) funds already received.

If you have already spent money from an insurance pay-out to fix the property, you can apply to the Council with a claim for these funds to not be deducted. You will need to show receipts and a declaration that the money was spent in good faith to repair the property.


Uninsured Properties
Uninsured and underinsured properties are still eligible for a buy-out, but the Council will only offer 80% of the valuation price.

However, you can make an application to the Council to have the percentage increased if you meet certain criteria due to not being insured.

The scheme allows homeowners to withdraw from the process any time before signing the sale and purchase agreement with the Council.


Getting professional/legal advice
The Council will contribute up to $5,000 towards your costs for legal fees (and/or using your own registered valuer).


Signing the Agreement for Sale & Purchase
A property advisor from the Council will present homeowners with the offer and a conditional Sale & Purchase agreement. It is recommended that you have the agreement reviewed by an experienced property lawyer before signing.

Owners have a month to deliberate over the offer, with acceptance formalised through the signing of the agreement. Should the offer not meet expectations, homeowners have avenues for dispute or can choose to opt-out entirely. Homeowners can choose to withdraw from the process any time before signing the sale and purchase agreement.

If you choose to op-out of the buyout, you should seek legal advice as to what the future ramifications might be for your ability to sell the property or otherwise dwell in or use the property.

You can negotiate the settlement date with Council through your Council property advisor.

If your property is tenanted, you will need to ensure your tenants vacate and clear their belongings by the settlement date. It is prudent to consult your legal advisor before setting a settlement date with the Council to ensure you comply with tenancy laws and provide tenants with sufficient notice.


Prior to settlement
Property owners are responsible for settling their insurance claims with their insurer and/or EQC prior to settlement. Information about the insurance pay outs must be provided to Council and the value of any pay out will be deducted from the Council’s valuation price (less 5%).

It is also the homeowner’s responsibility to ensure that all utilities payments are up to date and that providers have been advised to cancel services on or before settlement date.


If you have not already engaged a lawyer to provide advice on the agreement, you will need to instruct a lawyer to act on your behalf in the sale of your property to the Council, in the same way you would if you were selling your property on the open market.

The Sale and Purchase agreement will specify the settlement date, which is when the funds will be transferred to your solicitor. You will need to be moved out of the property before this can take place.

Making a decision about the Auckland Council’s Property Buy-Back Scheme? Don’t go it alone. Contact Wade Hansen, Property Law Specialist, for personalised guidance and support to ensure your rights and interests are fully protected. Let’s make this journey smoother together.

Wade Hansen
Phone: +64 9 837 6885


Were you affected by the floods or cyclone and considering Auckland Council’s Property Buy-Back Scheme?
Get the expert advice you need – paid for by the Council, contact Wade Hansen today.

email Wade
+64 9 837 6885

About the author

Born and bred in the West, Wade has a keen interest in developing the community and assisting businesses grow to their full potential. His experience in Property & Commercial Law, along with his common sense and level headed business knowledge
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