Residential Red Zone

Introduction

The land damage caused in residential areas by the September 2010 earthquake and then again by the February 2011 earthquake created issues for both property owners and the government, which had never been encountered in New Zealand before. Nearly two years after the February earthquake, those issues are on the path to resolution, with some key decisions made and some processes well established. Other processes are still evolving and the important decision about the future uses of the land is not yet made.

The residential red zones (RRZ) face a different set of problems from the central city red zone with many more property owners and insurers as stakeholders and a lot more emotion involved in the decision making. The homes that were here represented hopes and dreams of families as well as being the single largest financial asset of most.

Residential red zoned property in New Brighton Road showing impact of liquefaction.

So how is progress and what’s happening in the residential red zones across the city and in Kaiapoi, Brooklands and Pines Beach?

The numbers

There are 7207 properties within the RRZ, whose owners have received an offer from the government. Of these, 5479 property owners have settled. 1403 homeowners chose option 1, and sold both the house and the land to the government while 4076 homeowners chose option 2 and sold the land to the government and the house to their insurance company. In some cases, although the land was damaged, the house was deemed repairable from an insurance point of view, so CERA is managing these cases. In cases where the house is either repairable or relocatable, CERA will seek settlement of any land claim with EQC and the house claim with the insurance company.

Just over 2000 property owners have not finalised their arrangements for a variety of reasons. Many will do so in the next month or so. A small number of property owners have decided not to accept the government’s offer and are waiting to see what the government’s next move will be. The number of properties with homeowners or tenants still living in them is a subset of the 2000 homes where the arrangements are not yet finalised. From observation, very few of the RRZ streets are entirely empty.

CERA as property owner

CERA is currently managing the properties purchased by the Crown as settlements occur, with around 5,800 properties with 5,800 lawns to mow, hedges to trim and rates to pay. About 25% of the houses across the RRZ have been demolished with the percentage demolished varying quite markedly in different areas.

The RRZ offer was complex and it took most property owners some months to understand fully the implications of the various choices, decide which option to take and negotiate the final details. The announcements about which properties were categorised as RRZ were made in tranches over a period of nearly a year.

Demolition is managed by the insurance company for the properties which are deemed a total loss. The demolition is of all damaged insurable structures, which may include garages and driveways as well as the house, or may not include the driveway or the garage if they were not insured or deemed undamaged. There are several insurance companies involved, making a variety of arrangements with different demolition contractors, leading to the range of outcomes that are observable in the RRZ.

Land clearance

Taking Kaiapoi as an example, Courtenay Drive is the first sizeable group of properties (23 properties) where enough properties have been settled to allow the land clearance to proceed to the next stage where boundary fences and shrubs are removed. Large trees/shrubs have been recorded on a GIS database and have been left. CERA is looking for ways to make it more cost effective to keep the RRZ land well maintained and free of rubbish and ‘fly tipping’.

Cleared land in Courtenay Drive, Kaiapoi.

In the Golden Grove area of Kaiapoi, the RRZ streets have had many houses demolished. There are sufficient final settlements in large enough groups to commence clearing boundary fences, remaining structures and residual vegetation.  The process for dealing with the vegetation is contained in the report developed by Boffa Miskell in November 2012. (http://cera.govt.nz/sites/cera.govt.nz/files/common/residential-red-zone-vegetation-retention-methodology-14-november-2012.pdf)

Future uses of the land

At this stage CERA is focused on helping property owners make their decisions about their preferred options and move into homes elsewhere. In parallel there are consultations happening with stakeholder groups about what will happen to the land. Once decisions are made about the future uses of the land, a number of other decisions will follow such as what will happen to the streets, and to the distribution systems for water, stormwater, sewage, electricity and telecommunications.

New Brighton Road near Locksley Ave, where the road has been diverted onto the gardens of RRZ properties now owned by the government.

Timescale

The deadline for RRZ property owners to settle under the present offer has been extended from April to June 2013. When that deadline is reached, there will be more streets where all the properties have settled, so the demolitions can occur followed by the land clearances. However, some property owners have decided not to accept the present offer and see what the government’s next move is. Some of those property owners have declared their intention of taking their case to the courts. We can expect it to take many more months for these issues to be resolved, as although the number of property owners in this situation is a relatively small percentage, nearly all the cases are different and will take different paths to resolution.

Conclusion

The issues caused by the scale of land damage to residential homes are complex and challenging to resolve. Firstly it was complex to complete the geotechnical assessments to make the decisions about which properties should be categorised as RRZ. Secondly it was complex to decide what the government offer should be, given the variety of insurance arrangements and the types of damage to houses that had occurred. Thirdly it is complex to manage the 5,800 empty properties and to try to keep the RRZ streets secure and safe. Still to unfold are the complexities of the remaining property owners who have decided not to accept the government offer.

Much of the external focus has been on what is happening in the central city red zone, with New Zealanders from outside of Christchurch and even those who live in the much less damaged western suburbs relatively oblivious to the painful choices facing red zoners. While red zoners would like more awareness and empathy for their situation, they do not want any more attention from taggers, people dumping rubbish in empty sections, criminals and arsonists.

And another story for another day, is the plight of property owners whose homes and/or land is badly damaged, but who are not red zoned, and therefore face a different set of issues.