District councillors have unanimously approved a 30-year extension to allow Upper Selwyn Huts residents to stay in the settlement.
The vote at Wednesday's Selwyn District Council meeting brings an end to the eviction battle, which has lasted about 18 months and cost the council and residents more than $300,000.
The first fishing huts at the settlement were built in 1888, and over time, more temporary buildings were added.
Some of the huts became home to permanent residents.
The district council has issued 96 occupancy licences and about 150 people are estimated to live in the settlement.
The decision was met with applause from residents in the public gallery.
Before the vote, Selwyn Mayor Sam Broughton read out a letter on behalf of the Selwyn Hut Owners Association, in which they thanked the district council for its work so far.
The letter also said they hoped the district council learns from this process.
Springs Ward councillor Grant Miller was concerned the district council may be taking the "easy way out", leaving a future council to deal with the same problem in 20 years.
Said district council community services and facilities executive director Denise Kidd: "While some huts and dwellings are still used on a temporary basis, others are now occupied as permanent residences.
"This shift has changed the nature of the community and their needs.
"Our recent decision provides a clearer licence term, moving away from annual and short-term rollovers, giving licence holders greater certainty and the ability to plan ahead," Kidd said.
The approved staff recommendation for the 30-year extension was based on a hearing and deliberation process last month.
It will see the new licences take effect from July 1 next year. The licences require a review to be undertaken after 20 years.
A final deed of licence will be prepared following consultation on the 2026/27 Annual Plan, which will also confirm the updated licence fee.
"This is a significant step forward for the Upper Selwyn Huts community," Kidd said.
"We are committed to working alongside residents to ensure the area remains safe, sustainable, and well-managed for years to come."
Building inspections were initially planned as part of the extension but residents opposed them and said they would be invasive.
The recommendation also states an updated environmental assessment will be done every 10 years during the licence and prior to the expiry of the 30 years, with the findings to be shared with licence holders.
