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Legal fees and generous deposits for red zone

Hon Gerry Brownlee
Minister for Canterbury Earthquake Recovery

2 August 2011 Media Statement

Legal fees and generous deposits for red zone

The government has developed further details of its offer to buy the properties of insured Canterbury homeowners in the residential red zone, including legal support and generous deposit rates, Canterbury Earthquake Recovery Minister Gerry Brownlee announced today.

“The package includes a $3.83 million contribution to the legal costs of homeowners’ in the residential red zone who chose to accept the government’s offers to purchase their property

“Also, for those who accept the government's offer, a deposit of the lesser of 50 per cent of the purchase price (less any insurance payments already made), or $50,000, will be paid soon after the agreement is signed.

“This can be used to reduce existing indebtedness, to help arrange financing for purchasing another property, or to pay a deposit for a new home.

“We recognise many homeowners in the residential red zone are under emotional and financial stress and we want to ensure they can get access to the proper legal advice,” Mr Brownlee said.

If a homeowner chooses to accept the government's offer to purchase their entire property then the government will contribute up to 50 per cent of their legal costs, up to a maximum of $750.

If they chose to accept the government's offer to purchase the land only, then the government will contribute up to 50 per cent of their legal costs. For homeowners who choose Option 1, this will be up to a maximum of $750, and for Option 2, a cap of $500 applies.

Mr Brownlee said there was still a lot of technical detail to be worked through around the government's offers of purchase.

“However, we wanted to release some detail as early as possible so homeowners, many of whom have raised quite understandable queries, can be better informed to consider the right course of action,” Mr Brownlee said.

There are currently around 5000 properties in Canterbury in the residential red zone because their land is badly damaged from the earthquakes and is unlikely to be suitable for residential occupation for a considerable period of time.

On 23 June the government announced it will make an offer to buy the properties of homeowners with insurance in the residential red zone so they can get on with their lives quicker.

CERA is responsible for rebuilding greater Christchurch and its surrounds, and supporting the welfare of its residents. For more information visit


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