An estimated 700 properties across the country are now considered unliveable and homeowners will be offered a voluntary buyout through a funding arrangement between the Government and councils.

A further 10,000 homes will require investment in flood mitigation around them so they are protected when the next severe weather event hits.

Cyclone Recovery Minister Grant Robertson, also the Finance Minister, is making the announcement now in Wellington.

It follows months of analysis of local risk assessments in affected regions alongside data from insurance providers. Consultation with affected Hawke’s Bay property owners begins today while it is expected the same will begin in Auckland from June 12.

The Government set three categories for affected areas to be designated. Category 3 applied to areas where future severe weather event risk couldn’t be sufficiently mitigated, while category 2 applied to areas where it was determined community and property level interventions, such as raising stopbanks, were feasible to manage future severe weather event risk.

Robertson said the Government will enter into a “funding arrangement” with councils to offer the buyout for homes in category 3.

That would also co-fund the work needed to protect properties in category 2. An initial $100m to fund this work had already been announced as part of Budget 2023.

“The Government is committed to assisting local councils to find solutions for those who have been affected,” Robertson said.

“As I have said many times, we cannot meet all the costs, particularly knowing that we will see more extreme weather events like this.

“As a Government, we have to strike a careful fiscal balance between supporting affected communities and not making all tax-payers bear the cost.”

Making the announcement today, Robertson said

Decisions on the details of how the voluntary buyout process will work would be made in the coming weeks, including the criteria for valuing category 3 properties, how costs would be split between central Government and councils, and what would happen for uninsured properties.

Robertson said today’s focus was on homes but more information was to come regarding commercial properties.

“We are working with sectors, such as the horticulture sector on possible targeted support for commercial operators, and on regional plans that will provide overall support for recovery and rebuild,” he said.

Māori engagement would be conducted through a parallel process, which would address the future of whenua Māori (Māori land).

Councils would lead further engagement with affected property owners in their areas, Robertson said.

“From the beginning of this process, the Government has supported a locally-led response to the North Island weather events, as requested by councils and communities in affected regions.

“Today’s announcement will help councils get the right solution in the right place and avoid significant financial hardship for property owners.”

Minister for Auckland Michael Wood said it was understood Auckland Council would be contacting affected property owners from June 12.

Some owners of category 3 properties in Tairāwhiti had already been contacted with the remainder to be finalised over the coming weeks.

It comes as maps have also been released - for the first time - showing a breakdown of flood-hit areas in Hawke’s Bay and which risk categories each area has been placed into.

Much of Esk Valley, north of Napier, which was hit extremely hard by the cyclone, has been provisionally categorised as having an unacceptable risk to live on in the future (category three).

There are three risk categories (or zoning categories).

A large area of the Pākōwhai suburb in Hastings is in the third category, indicating it is unliveable. Photo / Supplied. 1/6/23.

Properties in category one have been deemed safe to rebuild on, and those owners can now fix their homes and safely return home.

Properties placed in category two or three are indicative only, meaning they could still be moved to another category in the future following community consultation, which will begin in mid-June.

Category two (which has three sub-categories) effectively means conditions will need to be met before a property is deemed safe to rebuild on (such as raised homes or improved stopbanks).

Category three properties will be deemed unsafe to return to and off-limits for living.

Whirinaki, just north of Napier, resident Maggie Braviner told Hawke’s Bay Today ahead of the announcement she eagerly wanted to be placed into category one.

“Definitely category one - we hope to be in that one. We would love to rebuild and love to return home.”

For those whose properties have been placed in category two or three, a lengthy process was still ahead to determine exactly what will need to happen for their properties to be deemed safe to rebuild on, or whether they will need to relocate due to the high flood risk.

Hawke’s Bay’s five councils, in collaboration with the Government’s Cyclone Recovery Taskforce, had been working on which areas should be placed into each category.

That risk assessment process was based on data from the regional council, Ministry for the Environment, and insurance company claims data.

A breakdown of the number of homes included in each category in Hawke’s Bay will be officially released at noon.

- Adam Pearse and Gary Hamilton-Irvine, NZH