However, it it is investigating whether Mr Tawhiti should be prosecuted for moving the buildings before consent was granted.
In October last year it fined his company $300 for illegally moving a home on to a section in Joll Rd, Havelock North.
The council told Totara St residents on Tuesday that asbestos might be in the buildings on their street.
Acting group manager, planning and regulatory services, Malcolm Hart, told them in an email: "We understand there may well be asbestos present in one [or] more of the buildings. The developer is aware of this and is required to take appropriate precautions. We understand that some of the asbestos is being removed as part of the development."
A residents' spokesman, Preston Epplett, said the houses' proximity to neighbouring properties was a concern if asbestos had to be removed: "The last thing we need is houses with asbestos being moved into the street. It's an illustration of what happens when you're moving old buildings."
Mr Tawhiti said yesterday there was no issue because if it was confirmed the buildings contained asbestos, he would have it professionally removed.
"The only issue can be if someone goes in and removes asbestos off the site who is not qualified."
He said most houses built before the 1970s contained asbestos, so his properties were no different from many of those owned by neighbours who had raised concerns.
Hastings Mayor Lawrence Yule said while the council was dealing with "one individual who has done some pretty high-profile, quite intensive relocates, which understandably people are concerned about", home relocations had not been a problem in the district.
The council was going through a comprehensive consultation process as it reviewed its district plan and most comments on building relocation provisions had come from the industry, which wanted standards relaxed.
"We didn't have people submitting that we needed to toughen the rules on relocated houses," he said.
Mr Hart said in his email to the residents that the investigation into Mr Tawhiti was expected to take about another fortnight.
"Once the investigations have been completed, case files will pass to our solicitors for legal opinion. Following receipt of that advice a decision will be made on the most appropriate course of action," he said.