Leaky homes hitting South Island

BY JOHN MCCRONE

It's said that Canterbury's leaky-home owners will be hit later than those in the North Island because of the drier climate. JOHN McCRONE discovers plenty of signs of what is coming.

I was wandering around Christchurch's four avenues looking at all the leaky apartments and townhouses. Once you know the telltale signs of what to watch out for, they leap out at you everywhere. The hairline cracks in the plaster, the patched corners around the windows, the little streaks of rust.

I had stopped to take a gawk at a particularly livid fracture in the cladding of a plum-coloured townhouse in Salisbury St, when a voice hissed at me from the depths of the bushes.

"Why you staring at my house? What you want?" It took a moment to spot the angry Asian lady, her head just level with the fence top.

"Yes, house no good. Wall's all rotten, " she agreed, unprompted. "But I don't want trouble. You go away."

There was a similarly bristling, if more tight-lipped, reaction from a mother unpacking her shopping outside a modernist cube a couple of roads further on.

Scaffolding had gone up around the set of units just that morning.

"It only needs repainting, " she said, as she hurried indoors.

And, in fairness, a lick of paint on the near-new homes might be all it was, but next door stood a complex of somewhat older units, riddled with plaster cracks and patched areas. Then next door along from them was a set of units looking dodgier still.

It seems no-one wants to talk much about New Zealand's leaky buildings scandal - not the owners, architects and builders, council or government.

But walk around the streets, and it is staring you in the face. A few are also realising it could be New Zealand's greatest single financial disaster.

Economist Brian Easton recently pointed out that with an estimated $11.5 billion bill to fix about 33,000 homes (and many would happily double those figures), the cost to the country in relative terms will be about 10 times what the United States has spent to bail itself out of the global credit crunch.

And this is not to mention the health costs that can come from living in a place that may unknowingly, for many years, be sprouting black toxic mould inside its nicely furnished walls.

Yes, it is a scandal. And if for individual homeowners it is a nightmare, then what is it like when it strikes a large city apartment complex?

Imagine the shock and confusion among 40 or 70 unit-holders - many of them retirees, immigrants or out-of-town property investors - when something has to be sorted.

Do they patch cheaply and hope the repairs stick, or spend large to change what could be a basically faulty design?

Do they make a claim to the Government's Weathertight Homes Resolution Service (WHRS), with all its uncertainties, or is it smarter to keep quiet, sell up and slip away?

I have been noting the "For sale" signs dotting many of the problematic buildings.

Experts say Christchurch has been behaving as if it does not really have a concern with its apartment blocks. A few flash houses up on the hilltops may leak, people think, but rotten communal housing is an Auckland story.

However, a relaxation of Christchurch's zoning laws about 10 years ago, meant to encourage high-density inner-city living, led to a rash of multi-unit developments, and these were built with the same untried materials, the same ill-thought-out designs, as in Auckland.

John Gray, of the Home Owners and Buyers Association of New Zealand (Hobanz), an Auckland pilot and leaky- home victim who set up the consumer body to advise owners, says it is only the drier Canterbury climate that has meant the damage has taken longer to show.

Yet that may also mean it ends up costing Christchurch more, given there is a 10-year limit on the WHRS claims process, he says. "Because the rot is hidden inside the walls, because people are burying their heads in the sand about the possibility they have problems, every year more homes are falling off the 10 years' claims cliff, " Gray warns.

So I walked around the town some more and began to hear some rather horrifying tales.

How about the block of flats where the residents don't even know if the foundations are safe?

Auckland pilot Paul Lyons is telling me about an investment unit he owns in a four-storey block in Bealey Ave. As the chairman of the residents' committee, he is in a tough position.

Lyons wants to be open and above board about the complex's problems. He has seen the poisoning effect secrecy has had on the leaky-homes issue. Owners don't know how to react, because they don't know how anyone else is reacting, and too often this means they don't react at all.

Instead, they procrastinate, which only suits anyone who might be held accountable, like the councils, developers and architects.

So publicity is desperately needed, says Lyons. But he says many of the block's residents are elderly or still struggling to get their heads around what might be the worst case for their own building. It is all still very raw. Then there are those with investment properties who fear that if they go public and potential tenants take fright, the empty units could quickly bankrupt them.

However, Lyons is fuming at what the inspections have been uncovering. The 42 apartments were completed in 2000. Lyons says he bought his rental unit in 2006 after careful checks.

"We had an engineering report done. The property had a proper Code of Compliance certificate. All the boxes had been ticked, " he says.

But the next year, when the block was due to be painted, the painters found a number of cracks and problem areas. The first investigation was followed by a more detailed one, and it was realised the block had serious issues with its plaster over wood- frame cladding.

Lyon reels off the details from a 600-page document. Incorrect fitting of aluminium windows and sliding doors; incorrect fitting of cap, barge and apron flashings; non- compliance with code of the plaster work.

"So, incorrect installation of three major components relating to weathertightness, " he says witheringly.

"The report has a photo of the ridge capping on the roof, " Lyons continues. "There's a whole section where there are no nails in the ridge cap. Someone just hasn't finished putting it on. Now that goes back to the project manager. That goes back to the person who signed off the building as completed. And that goes back to the Code of Compliance person. There are multiple levels of responsibility here." Or incompetence, he means.

Even more alarming is that testing has found voids in the concrete-block foundations. Someone was sloppy with the cement pouring.

It could still be all right, says Lyons. The voids look small and a more thorough ultrasound probe is being organised.

"But it'll make our WHRS issues rather moot if the foundations are shot, " he says grimly. There would be no question of repair. "The whole lot would have to be dropped."

As it is, early estimates are that it will take $2 million to remedy the complex. And because the worst is never known until a clad building is opened up, it could go anywhere from there, Lyons says.

It is fortunate that the unit owners have managed to keep a grip on the situation. They were helped greatly by early advice from Hobanz - Lyons knew John Gray.

"We got a WHRS claim in by May 2008, so we stopped the clock back then."

Lyons says the 42 unit holders have also agreed to act collectively.

A common hurdle with multi-owner complexes is that the more exposed apartments will, of course, suffer the first decay.

"My unit is, in fact, in a reasonably good state, because it is around the sheltered side, " Lyons says. In this situation, it is only natural for owners to ask why they should be expected to share the costs of others.

However, he says, if a whole building is made the same way, it is only a matter of time before the same rot sets in everywhere. So the whole building needs to be tackled during repairs.

- © Fairfax NZ News