Source: Auckland Council
Section 74 notices are something we’ve been hearing more about in the news lately. That’s because they apply to properties affected by natural hazards, and these have been in the spotlight in the aftermath of severe storm events earlier this year.
So, what is a Section 74 notice and how might it affect your property? Read on for some answers to frequently asked questions that will help you better understand this important piece of Building Act legislation.
What is a Section 74 notice?
A Section 74 notice is something that might be applied during the building consent process to properties in New Zealand affected by natural hazards.
As set out under Section 72 of the Building Act 2004 (or its predecessors, s 641A of the Local Government Act 1974, and s36 of the Building Act 1991), territory authorities like Auckland Council must grant building consents on land which is subject or is likely to be subject to one or more natural hazards, so long as the building work proposed is unlikely to make the hazard worse. In these circumstances, the consent can be granted but with the requirement that a section 74 notice is registered on the Record of Title (what used to be called a Certificate of Title).
What is the purpose of a Section 74 notice?
A section 74 notice allows property owners to build on land subject to natural hazards while also providing a level of protection to both the consenting authority and future prospective buyers. The two key purposes of the notice are to:
- Alert subsequent buyers to the presence of a natural hazard on the property
- Protect councils from legal action related to the exercise of the owner’s right to build on the land when it is affected by natural hazards.
How are Section 74 notices applied? Could I get one on my property?
Section 74 notices can only be applied as part of a building consent process. Before a building consent is issued that requires the registration of a section 74 notice, the council requires an owner to sign an Acknowledgement of Risk to confirm they have consulted with legal and technical experts and understand the nature of the condition and legal implications.
Once a section 74 notice has been registered, it stays permanently on the property’s Record of Title. The presence of a Section 74 Notice is something a lawyer or conveyancer should flag with any prospective buyer as part of the property purchasing process.
Records of Title for any property can also be downloaded for a small fee from the LINZ website.
What is considered a natural hazard?
The Building Act defines a natural hazard as land subjected to:
- erosion (including coastal erosion, bank erosion, and sheet erosion)
- falling debris (including soil, rock, snow, and ice)
- subsidence
- inundation (including flooding, overland flow, storm surge, tidal effects and ponding)
- slippage.
Hazards such as tsunamis or earthquakes are not regarded as natural hazards under the Building Act.
How many properties in Auckland are affected by Section 74 notices?
In August 2023, LINZ estimated that there were 4089 property titles in the Auckland Council area with Section 74 notices applied. That’s less than 1 per cent of the total properties in the region.
Can I get a section 74 notice removed from my property?
It is possible to have a Section 74 notice removed only if the council is satisfied that the hazard has been eliminated or mitigated through property works or local infrastructure changes. By law, the notice cannot be removed for insurance purposes or any other similar reason.
Can I still get insurance if I have a section 74 notice on my property?
How a Section 74 notice might affect your insurance policy is something you should discuss with your insurer.
The Earthquake Commission (ECQ) also provides information on their website about Section 74 notices and how these may impact EQC insurance claims.
Find more information on building on land subject to natural hazards on our website.
