Planning for resilience: addressing the challenges of managed retreat in New Zealand

Climate change continues to pose significant risks to communities worldwide, and New Zealand is no exception. Recent reporting by the Ministry for the Environment (MfE) and Stats NZ indicates that hundreds of thousands of people and, as at October 2025, NZD235 billion of assets are already exposed to increasing coastal inundation and river flooding, with those figures expected to grow over coming decades. These trends underline the scale and urgency of the adaptation challenge.

In this context, managed retreat – the planned relocation of people and assets from areas of escalating risk – is receiving increased attention as a proactive adaptation option. Unlike purely reactive responses to disasters, managed retreat aims to mitigate future harm, reduce hardship and support more equitable outcomes.

This article considers the current approach to managed retreat in New Zealand, recent policy developments, and the implications for key stakeholders, including local government, infrastructure owners, insurers and lenders. It also outlines emerging themes that could inform a more coherent and durable national framework.

 

Recent developments in managed retreat in New Zealand

Recent extreme weather events, including Cyclone Gabrielle and the Auckland Anniversary Weekend floods, have brought the question of managed retreat into sharper focus. In response, central government has commissioned a series of expert reports and inquiries examining relocation options, funding models and institutional responsibilities.

In 2023, the Expert Working Group on Managed Retreat released Te Hekenga Rauora, proposing a framework for planned relocation. This was followed by select committee recommendations on climate adaptation and expert advice from an Independent Reference Group on Climate Adaptation established by MfE. In October 2025, the Government published a National Adaptation Framework to address rising risks from natural hazards such as floods and storms. The framework covers flood mapping, community-level adaptation, land use planning and emergency response. Despite successive governments signalling the importance of climate adaptation, a dedicated managed retreat regime has not yet been implemented.

Recent advisory reports have highlighted, among other things:

• the need for consistent, accessible climate risk data to support transparent decision-making
• clearer powers and protections for local government, including support for Māori-led adaptation initiatives
• fair and sustainable funding arrangements, with costs shared across central government, local government, asset owners and beneficiaries
• more targeted financial support for property owners, with an emphasis on hardship and the protection of cultural assets

These proposals have generated debate, including concerns that current recommendations do not go far enough in setting out the role of public funding or the circumstances in which property acquisition or relocation schemes should be supported.

 

Te Tiriti o Waitangi and Māori interests

Any future managed retreat framework will need to engage meaningfully with Te Tiriti o Waitangi and Māori rights and interests. Many at-risk areas are of significant cultural, spiritual and economic importance to iwi and hapū, and may include whenua Māori held under collective ownership structures.

Recent advisory work has emphasised the value of Māori governance and Māori-led initiatives in adaptation planning, and the importance of incorporating mātauranga Māori into decisions about whether, when and how communities relocate. For public bodies, infrastructure owners, insurers and lenders, early engagement with Māori and recognition of these dimensions will be critical to achieving outcomes that are both lawful and durable.

 

Local government responses

At the local government level, some district and regional councils have taken matters into their own hands using the limited tools currently available. For example, the Hawke’s Bay Regional Council, working alongside central government, has introduced voluntary property acquisition schemes for properties deemed unsafe to rebuild. Categorising affected properties to determine the appropriate level of intervention has allowed for more flexible and tailored responses.

Some communities, including in Kumeū and Westport, have advocated for more sustainable relocation options and are actively planning for the potential relocation of town centres. In January 2025, the Government announced a new national directive intended to give councils a stronger basis for declining consents for dwellings in high-risk flood zones, reflecting a wider trend of local government taking more assertive steps in this space.

However, without legislative powers specifically targeted at climate adaptation, local government remains largely restricted to mitigating the impacts of climate change on new development rather than relocating existing at-risk communities.

 

The need for a proactive approach

Despite growing momentum, much of New Zealand’s approach to climate-related risk management remains reactive, driven by specific weather events or by local government attempts to influence development patterns through consenting processes. While these responses can provide short-term relief, the absence of a coordinated national strategy has resulted in inconsistent approaches and inequitable outcomes across regions.

Managed retreat offers a forward-looking pathway, but successful implementation depends on comprehensive planning, equitable funding and clear legislative support – areas where the current system remains underdeveloped.

 

Funding and financial risks

Funding remains one of the most challenging aspects of managed retreat. Questions around who should bear the cost – central government, councils, property owners or insurers – are yet to be resolved. A mix of funding sources may be necessary to ensure fairness and incentivise responsible decision-making.

Central government has signalled its intention to move away from buy-outs of damaged properties. For insurers and banks, climate risk is already reshaping risk appetites, pricing and product design. Insurers are increasingly assessing location-specific hazard profiles when issuing or renewing cover and may apply higher premiums, sub-limits or exclusions for properties in high-risk zones. Banks are factoring climate impacts into credit due diligence and portfolio management, including stress testing mortgage and commercial property portfolios for physical risk exposure.

These developments have important implications for managed retreat. In some areas, rising premiums or reductions in cover may precede formal decisions about relocation, with property owners effectively experiencing “insurance retreat” before any regulatory intervention. Similarly, lenders may become more cautious about accepting security in high-risk areas. In the absence of clear national policy, these market responses risk being uneven and may entrench inequities between communities with differing ability to self-fund adaptation.

 

Case studies: insights from New Zealand

Recent examples illustrate the varied and often ad hoc nature of responses to climate-related risk:

• Hawke’s Bay and Auckland: Severe weather events prompted councils to adopt property acquisition and seawall policies, often as reactive measures.
• Nelson: A council-led acquisition of homes affected by slips received broad community support, demonstrating the potential for consensus in planned relocation.
• Auckland’s Wynyard Quarter: Engineering solutions are being used to address inundation risks for apartment complexes, indicating a preference for mitigation over relocation in some situations.
• Selwyn: Planned retreat proposals have attracted significant resistance, reflecting the difficulty of balancing long-term climate planning with community expectations.
• Coastal Auckland: Homeowners in high-value coastal suburbs are facing new restrictions and consent barriers in response to coastal erosion risks.

These examples highlight the need for a unified and transparent national framework to support consistent and equitable outcomes.

 

International insights

Globally, managed retreat remains an emerging concept. While jurisdictions such as Australia, Hong Kong and France have explored relocation strategies or broader adaptation measures, few have developed comprehensive statutory frameworks that New Zealand can directly adopt.

This lack of international precedent underscores the importance of developing an approach tailored to New Zealand’s legislative settings, Māori rights and interests, community values and funding structures.

 

Moving towards a unified framework

The current fragmented approach to managed retreat in New Zealand is unlikely to be sustainable over the long term. Without a clearer national framework, underpinned by statutory powers and funding principles, inconsistencies and inequities will persist and exposure to climate-related losses will continue to accumulate.

A durable system will require alignment between central government direction, local authority planning frameworks, community expectations, Māori interests and the risk appetites of insurers and lenders. Legislation will not resolve all tensions, but it can provide clearer objectives, decision-making criteria and funding pathways.