Uninsured homes will be included in Gisborne buyout scheme

Uninsured homes will be included in Gisborne buyout scheme

Uninsured homes will be included in Gisborne buyout scheme | Insurance Business New Zealand

Insurance News

Uninsured homes will be included in Gisborne buyout scheme

Empty land where people intend to build, however, is out

Insurance News

Kenneth Araullo

The policy delineates eligibility criteria and the rationale guiding decision-making. The three core stipulations include:

acquiring land necessary for the objective
exhibiting manaakitanga to aid swift community recovery
demonstrating responsible expenditure of ratepayer funds

The scheme offers two avenues for buyouts: a “property purchase offer” where the council acquires both the house and land, assuming ownership of the title, or a “residential relocation offer” enabling homeowners to retain the title while receiving a council grant to vacate the high-risk area. The latter option involves imposing a covenant on the land to prevent future home construction.

Properties exceeding one hectare, regardless of their use during the cyclone, are classified as “mixed-use” and qualify solely for a relocation offer. Council officers cited the challenge of individually evaluating such properties due to the nine-month time lapse since the cyclone and the impracticality of acquiring entire farms due to high costs.

No buyouts for empty land

Regarding insured and uninsured homes, while some advocated different treatment for fairness, officers noted only one property faced this issue due to post-purchase insurance unavailability. Managing such cases differently was deemed inefficient and contrary to the policy’s goal of incentivising relocation from hazard zones.

It is also worth noting that unlike decisions made in Hawke’s Bay, Gisborne has not sanctioned buyouts for properties where construction was intended but had not commenced. This distinction was justified by Gisborne council officers, who believed purchasing undeveloped sites contradicted the policy’s objective of acquiring only essential land.

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Valuation of homes will be undertaken by a council-commissioned registered valuer, allowing homeowners to seek a private valuation at their cost. Discrepancies between valuations will be reconciled through a comparison or, if needed, by a third independent valuer.

The scheme also covers legal costs up to $1,500, distinct from the Hawke’s Bay offering of up to $5,000. All offers will expire on March 31, 2025, with homeowners allowed to pause or cancel the process, subject to council discretion for reinstatement.

Special considerations might apply to Whenua Māori homeowners choosing the Kaupapa Māori pathway, currently under development by the central government, excluding them from the mentioned policy.

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