Leaky building package is not good enough - lawyer
18 May 10The package to help fix leaky homes is not good enough, a lawyer for leaky home owners says.
Paul Grimshaw, of Grimshaw and Co, will advise his clients to continue with litigation, Radio New Zealand reported.
Building and Construction Minister Maurice Williamson yesterday announced the Government and local authorities would each contribute 25 percent of the agreed repair costs, with the homeowner picking up the remaining 50 percent.
Those who take up the package lose the right to sue the Government and councils.
Mr Grimshaw said it was about how home owners could get the most money.
"I'm not going to be telling the clients that they should effectively take only 25 percent from the council when if they go through the courts they can get 100 percent from the council."
The package could help people who had to spend less, $100,000-$200,000, to fix their property, he said.
But, that would depend on loan rates and availability.
Not all leaky home owners would be eligible for the new package; a PricewaterhouseCoopers report last year estimated that 22,000 to 89,000 homes could be affected, with 42,000 likely to be leaky based on design and materials. Only about 3500 had been repaired.
Only homes flagged as leaky with the Department of Building and Housing within 10 years of being finished would be eligible. A home built in 1995 but notified to the department as being leaky in 2003 would be covered but one built in the same year and not notified would not. Notifying the department effectively "stopped the clock".
Based on some missing the 10-year qualifying period, officials estimated 23,500 would be eligible for yesterday's package - leaving possibly tens of thousands to pursue other options.
Councils were yet to sign up to the package but Wellington Mayor Kerry Prendergast and Auckland Mayor John Banks were "confident of a buy-in".
PACKAGE 'COULD HIT RATES'
Rates could increase to pay local authorities' share of fixing the leaky homes problem, Wellington Mayor Kerry Prendergast says.
Ms Prendergast did not estimate what it would cost the Wellington region but said claims already settled through other means cost "significantly less" than what the 25 percent contribution would total.
"But we believe we need to step up to the mark the same as the Government has agreed to," she said.
"Potentially it is going to mean a greater burden (on ratepayers)."
Local authorities had proposed the same 25-25-50 split to the previous government, which had rejected it, Ms Prendergast said.
"So it is something that we have been working to for some time and it's why we're so delighted that this Government has listened and come up with a package pretty much where local government was coming from several years ago," she said.
The announcement received a positive response from the banks and the Building Industry Federation.
The New Zealand Bankers' Association, representing all the main retail banks, said that while no commitments had been made its members were keen to work with the Government on the details of the scheme.
"Member banks have agreed to set up a joint industry and government working group to do so," said the association's chief executive Sarah Mehrtens.
The Building Industry Federation said the financial package was a base for moving forward.
"Our manufacturing and supply chain looks forward to working with the Department of Building and Housing and other sector interests to make this package work," said chief executive Bruce Kohn.
"The essential factor is to get some certainty in the process. This package contributes to that."
Source: Stuff NZ
