A group of Queenstown landowners say they are concerned proposed cultural consultation rules will devalue their properties and create a racial divide.

As part of Queenstown Lakes District Council's proposed district plan process, local iwi identified wāhi tūpuna sites, areas within the district that held specific cultural values, which included 3226 properties.

These landowners received a letter, stating if the rules came into effect they would have to consult iwi if they undertook any development, including almost all earthworks.

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Russell Carr told Mountain Scene of his "disbelief" the Kelvin Heights property he and his wife had owned for 41 years had now been selected as "a site of significance to iwi".

"Furthermore, all I can see is a wedge being put in place between Europeans and Māori."

He called the process "haphazard", with no information provided as to why his property was significant, and not others.

Neil Jackson, who lives above Frankton Beach, said he was concerned the designation could put off future prospective buyers.

Todd & Walker Law senior solicitor Ben Gresson said affected landowners who wanted to do any development on their land would have to consult with the iwi, at their cost and prove it would not affect their land's cultural value.

"It just adds another layer of uncertainty and cost."

Council spokesman Jack Barlow said at the moment it was just a proposal, and there was the opportunity for submissions and hearings.

"The intended purpose is to allow potential impacts on the cultural values of iwi to be considered alongside what the rest of the district plan requires to be considered for development and activities in that area."

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If the wāhi tūpuna rules came into effect people would have the same rights to appeal as they would with any other consent decision, Barlow said.

"If your activity falls within a wāhi tūpuna area, as with any activity and development, it is recommended that the relevant district plan policies and rules are reviewed before work begins.

"Where consultation is required, doing this early in the process is considered the best way to ensure the effects of certain activities are appropriately managed, similar to how it is considered best practice that neighbours are consulted before lodging an application for a resource consent."

Consultation work would be done on a cost-recovery basis and applicants could be charged a fee from Aukaha Ltd or Te Ao Marama Inc, he said.

The Herald has approached Ngāi Tahu and the council for further comment.

Auckland Council drew up rules in the Unitary Plan - a planning rulebook for the Super City - requiring homeowners and businesses to obtain a "cultural impact assessment" from one or more of 19 iwi groups on more than 2000 sites of cultural and heritage value to Māori.

Groups and politicians were concerned the rule would create a dual resource consents process - one conducted by Auckland Council and the other by Māori - but the concerns died down after the Unitary Plan came into effect in 2016.