There are articles and reports available but they tend to suffer from providing recommendations based on how to correct current shortfalls in the industry and its legislation while being commissioned by organisations or government departments from within the industry. This is an incestuous start point for any writer. And at the same time can miss the most critical issue: the detrimental effects to the well being of homeowners and their homes

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Report of the Overview Group on the Weathertightness of Buildings to The Building Industry Authority, 2002

(The Hunn report)

Report of the Overview Group on the Weathertightness of Buildings to The Building Industry Authority, 2002

 bBy  • Don Hunn (Chair) • Ian Bond • David Kernohan

Overall the report is well written. The report is based on interviews, opinions, current regulations and provisions of the law, legal findings, posing questions then answering them to put flesh on the bones of the report. Mainly focusing on legislation, the correction of legislation, how legislation is administered, how legislation and the industry has underperformed through the supply chain and what improvements could/should happen to reduce the issue going forward.

 

The good bits;

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1. The report confirms that there are fundamental problems with the regulations, regulators, how the industry is legislated and the limited recourse available to homeowners when there is a problem. It’s a cornerstone document where the blame is unavoidable for government and councils.

2. The report discusses why legislation does not cover homeowners in any meaningful way if they have a problem with their home (as well as a myriad of other topics)

3. There are some incisive comments from people interviewed and from the authors like this: “we have been struck by the paradox of what seems to be a formidable paper trail accompanying this progression on the one hand, and the apparent lack of accountability on the other – either for the process as a whole or for its constituent parts”

 

The bad bits;

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1. The discussions, supporting analyses and the overall extensions of these are based on looking at the current industry, legislation, deficiencies, and paths to compliance. Solutions are proposed that still fall within and are built from this frame work. I think this is only attacking the issue by rearranging the deck chairs on the Titanic as its sinking. Wholesale consideration and solutions are called for but the report is swamped by the issues and legislative tension of the time. As time has moved on, the extent of the problem has become more obvious, remedial costs have increased and consequentially the effect to Aotearoa on a national scale as well as the affect to individuals keeps growing.

2. The report is commissioned by the government, for the government and is completed by authors from the industry and civil service. While the report shows clear effort at looking at the issue of leaky homes as impartially as possible, the authors had a scope of reference and prepared the report for the Building Industry Authority of New Zealand at the time. The weighting of the comments reflects this. In all fairness to the authors they have done a fantastic job given the monumental pressure to bring clarity to the issue and make recommendations going forward. The report is actually well written and comprehensive and therefore has merit. Strong arguments underpin recommendations and therefore the path to success should have been achievable. 23 years later its clear that the industry has responded to some of the recommendations, but the overall issue has not gone away. 

 

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Prendos – Leaky homes and leaky building syndrome

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This report is naïve and flippant in nature. Prendos purports to be “the nationwide specialists in property consulting and a RICS Regulated firm”. In reality they are a collection of project managers, building surveyors, property surveyors, quantity surveyors. In other words a business selling industry professionals.  The supposed report on weathertightness issues carries a few paragraphs at the top of the report then quickly devolves into the process and professionals of how to commission the necessary professionals and what to consider when doing so.

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The good bits;

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They have included a handy picture of a house and named some of the parts. Next to the name of each part you can click and get some supporting photographs of how it’s all gone wrong. The photos are all horrendous weathertightness failures. Very small and not very helpful but they do show how serious the problem can be.

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​The bad bits;

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The article is so lightweight I find it insulting as a builder. It’s indicative and demonstrative of why builders with experience have scorn and occasionally contempt for the professional side of the industry. It’s too focused on the generation of business and how to maintain promote professional image rather than exposing what’s wrong and how to fix it.

 

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PWC (Price Waterhouse Cooper) 2009

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PWC prepared a report for Department of Building and Housing Weathertightness – Estimating the Cost

This is an outstanding report.  While it is wordy as you would expect from a financial institution it is well written and readable. You’re going to need a hot cup of tea and some gingernuts to get through this bad boy. If you are an industry professional, tradesman, designer, wade your way through it and get what you can from it.

 

The good bits

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Lots and lots of information…facts, figures, charts, and actual industry-based evidence. The report starts with the usual disclaimer but this is washed away quite quickly by solid information and honest writing.

Under Findings at the top of the report there is an outstanding summary of under reporting of the extent of weathertightness issues and reasons offered for it.

 

There are a range of reasons for the low level of recorded failure compared to experts’ best estimates of the ultimate failure rate, including:

• problems that have yet to visibly manifest (and of which homeowners are, therefore, ignorant);

• denial behaviour by homeowners of the existence and/or potential severity of problems and hence the urgency of need to address them;

• inability of some homeowners to finance any form of major repair;

• the transaction costs of pursuing a claim;

• informal settlements between owners and builders (particularly outside of the major urban areas) or homeowners simply fixing problems at their own cost;

• procedural obstructions to bringing claims on behalf of all owners within a multi-unit complex; and

• slower manifestation of problems in drier areas of the country

 

Establishing the nature, costs and timing of existing failures

• it is entirely possible that large numbers of small failures have not been notified to the WHRS. Expert opinion, however, suggests that these small failures have the potential to become severe problems.

 

The bad bits;

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There is not a lot that I could call bad, but I will point out that this report falls into the same trap as other reports and discussions by referencing monolithic cladding as the main culprit. While this may be true statistically, if enough groups and professionals keep noting monolithic cladding as the issue then other claddings could be construed or assumed to be problem free. They are not. The main motivation to complete my book was finding homes with weatherboard style cladding that had long term leaky issues. I was being called to an increasing number as the weather patterns worsened over the last few years, homes aged and materials deteriorated.

Or putti ng it another way, monolithic EIFS finished buildings are rare where I live in Whangarei NZ but leaky homes are not.

I’m disappointed and a little surprised that such a thorough report doesn’t expand on the consequential costs to homeowners over and above the remedial costs. There is a small mention but I would have expected PWC to have the skill base and the motivation to look beyond the simple matter of the hard consequential costs and at least discuss  other “costs” like:

1. Loss of income to individuals and families dealing with the issues

2. Health effects and costs from mouldy or damp homes

3. Loss of market value for a repaired home and how this can affect the homeowners overall wealth

4. Increased costs for support for those affected by leaky homes by the health sector and the country generally,

5. The administrative and regulatory costs of the government and council enacting corrective measures to legislation and operational costs.

6. Loss of retirement funds due to loss of asset value.

7. Increased industry and construction costs in response to leaky homes 

 

All of these costs are real and if you ask anybody with any knowledge and experience of the time and money to work through this type of issue you will hear numbers and time that are frightening. These need to be acknowledged as part of the cost to the country as well as a cost to individuals.  

 

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Barry Mosely - Weathertightness, Economic Loss, Equity and Remedies (Feb 2025)

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This is also a well written and considered piece with the focus on and around legislation, performance of legislation, the accountability of building inspectors and councils and other matters that you could loosely group as the academic or regulatory side of the leaky home crisis. I don’t see any issue with this approach, but the main audience would be regulators and local governments.

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The good bits;

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There are strong recommendations from Mosely

1. The current situation also signals a strong need for further reform of the Building Act if better performance is to be incentivised.

2. Housing is where most individuals store their wealth. A weak legislative framework around the industry players and regulators, combined with constrained legal remedies, can only continue to promote inequity and lead to housing which is both more expensive and involves a significant, inequitable transfer of costs.

3. There are strong arguments that a special tribunal should be in place with inquisitorial powers to investigate where building failure associated with the likes of the ten-year liability clock is a ‘blunt’ mechanism which continues to promote repetitive recladding of buildings and system failures at a frequency which diverges significantly from the structural life of most buildings. Weathertightness, Economic Loss, Equity and Remedies Policy Quarterly – Volume 21, Issue 1 – February 2025 – Page 37 weathertightness or structural failure results, and it should not be subject to an arbitrary time limit of ten years.

The bad bits

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Mosely echoes the Hunn report which echoes our “Australian colleagues”;

'…the building regulation system should rely on three core pillars: namely, responsibility, accountability and liability…'

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On the surface this is a reasonable assertion. However, the fundamental paradigm still relies on regulation to the rescue. If a regulator, builder, designer or other professional is negligent then the natural path would be responsibility, accountability, litigation of the issue if we are approaching leaky homes this way. I suggest that the efforts need to focus on the core issues of what are the causes of leaky homes and how do we avoid designing, legislating, building these causes into the industry and then consequentially into our homes? Litigation should be rare…not the solution. Mosely further explores responsibilities and liabilities via the Hunn report and then through his own comment;

 

“There can be over 50 sub-contractors on a large site. The co-ordination and sequencing of cladders, flashers, plumbers for instance…

…It has been reported to the Overview Group that more and more often responsibilities and liabilities are being passed ‘down the line’ to the subcontractors and sub-trades. Whatever the reality of this, the circumstances result in a collective system failure – and buildings that leak. (Hunn, 2003, p.9)”

From Mosely;

Given the density of development occurring in major New Zealand cities and the scale of construction, it is possible to have reservations about whether this aspect of the weathertightness problem has been resolved and the lines of responsibility are now both transparent and unambiguous. One way to address this matter may be to prescribe professional responsibilities, something that I am not aware has been attempted in any relevant legislation to date.

 

I understand the premise Mosely is discussing (if people know they can be more easily held to account then they are more likely to keep standards high to avoid cost of defending or loosing legal proceedings taken against them). However, when you take into account the complexities of 50 or so different trades or groups of trades on a large site then you realise that the practicalities of attributing liability to an individual or company becomes extremely difficult. The best situation is not litigation – stay on the right side of good design and quality workmanship and the need for litigation becomes unnecessary.

 

There are more media and industry reports available on the internet.